Correlation Between ScanSource and NECELE

Can any of the company-specific risk be diversified away by investing in both ScanSource and NECELE at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining ScanSource and NECELE into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ScanSource and NECELE 217 25 NOV 26, you can compare the effects of market volatilities on ScanSource and NECELE and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in ScanSource with a short position of NECELE. Check out your portfolio center. Please also check ongoing floating volatility patterns of ScanSource and NECELE.

Diversification Opportunities for ScanSource and NECELE

0.28

Correlation Coefficient

ScanSource  NECELE

Modest diversification

The 3 months correlation between ScanSource and NECELE is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding ScanSource and NECELE 217 25 NOV 26 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NECELE 217 25 and ScanSource is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on ScanSource are associated (or correlated) with NECELE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NECELE 217 25 has no effect on the direction of ScanSource i.e., ScanSource and NECELE go up and down completely randomly.

Pair Corralation between ScanSource and NECELE

Given the investment horizon of 90 days ScanSource is expected to generate 1.4 times more return on investment than NECELE. However, ScanSource is 1.4 times more volatile than NECELE 217 25 NOV 26. It trades about 0.05 of its potential returns per unit of risk. NECELE 217 25 NOV 26 is currently generating about -0.21 per unit of risk. If you would invest  4,762  in ScanSource on October 21, 2024 and sell it today you would earn a total of  284.00  from holding ScanSource or generate 5.96% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	48.39%
Values	Daily Returns

ScanSource  vs.  NECELE 217 25 NOV 26

ScanSource

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in ScanSource are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of rather weak basic indicators, ScanSource may actually be approaching a critical reversion point that can send shares even higher in February 2025.

NECELE 217 25

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days NECELE 217 25 NOV 26 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite unfluctuating performance in the last few months, the Bond's basic indicators remain somewhat strong which may send shares a bit higher in February 2025. The current disturbance may also be a sign of long term up-swing for NECELE 217 25 NOV 26 investors.

Pair Trading with ScanSource and NECELE

The main advantage of trading using opposite ScanSource and NECELE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ScanSource position performs unexpectedly, NECELE can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in NECELE will offset losses from the drop in NECELE's long position.

The idea behind ScanSource and NECELE 217 25 NOV 26 pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.