Correlation Between Scworx Corp and National Research

Can any of the company-specific risk be diversified away by investing in both Scworx Corp and National Research 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 Scworx Corp and National Research into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Scworx Corp and National Research Corp, you can compare the effects of market volatilities on Scworx Corp and National Research 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 Scworx Corp with a short position of National Research. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scworx Corp and National Research.

Diversification Opportunities for Scworx Corp and National Research

0.87

Correlation Coefficient

Scworx Corp  National Research

Very poor diversification

The 3 months correlation between Scworx and National is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Scworx Corp and National Research Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Research Corp and Scworx Corp 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 Scworx Corp are associated (or correlated) with National Research. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Research Corp has no effect on the direction of Scworx Corp i.e., Scworx Corp and National Research go up and down completely randomly.

Pair Corralation between Scworx Corp and National Research

Given the investment horizon of 90 days Scworx Corp is expected to under-perform the National Research. In addition to that, Scworx Corp is 1.93 times more volatile than National Research Corp. It trades about -0.23 of its total potential returns per unit of risk. National Research Corp is currently generating about -0.11 per unit of volatility. If you would invest  1,741  in National Research Corp on December 29, 2024 and sell it today you would lose (336.00) from holding National Research Corp or give up 19.3% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

Scworx Corp  vs.  National Research Corp

Scworx Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days Scworx Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

National Research Corp

Risk-Adjusted Performance

Very Weak

Over the last 90 days National Research Corp has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Stock's basic indicators remain rather sound which may send shares a bit higher in April 2025. The latest tumult may also be a sign of longer-term up-swing for the firm shareholders.

Pair Trading with Scworx Corp and National Research

The main advantage of trading using opposite Scworx Corp and National Research positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scworx Corp position performs unexpectedly, National Research 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 National Research will offset losses from the drop in National Research's long position.

The idea behind Scworx Corp and National Research Corp 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.