Correlation Between DXC Technology and Scotiabank Peru

Can any of the company-specific risk be diversified away by investing in both DXC Technology and Scotiabank Peru 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 DXC Technology and Scotiabank Peru into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between DXC Technology Co and Scotiabank Peru SAA, you can compare the effects of market volatilities on DXC Technology and Scotiabank Peru 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 DXC Technology with a short position of Scotiabank Peru. Check out your portfolio center. Please also check ongoing floating volatility patterns of DXC Technology and Scotiabank Peru.

Diversification Opportunities for DXC Technology and Scotiabank Peru

-0.61

Correlation Coefficient

DXC Technology  Scotiabank Peru

Excellent diversification

The 3 months correlation between DXC and Scotiabank is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding DXC Technology Co and Scotiabank Peru SAA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scotiabank Peru SAA and DXC Technology 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 DXC Technology Co are associated (or correlated) with Scotiabank Peru. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scotiabank Peru SAA has no effect on the direction of DXC Technology i.e., DXC Technology and Scotiabank Peru go up and down completely randomly.

Pair Corralation between DXC Technology and Scotiabank Peru

Considering the 90-day investment horizon DXC Technology Co is expected to under-perform the Scotiabank Peru. But the stock apears to be less risky and, when comparing its historical volatility, DXC Technology Co is 1.81 times less risky than Scotiabank Peru. The stock trades about -0.09 of its potential returns per unit of risk. The Scotiabank Peru SAA is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  1,044  in Scotiabank Peru SAA on May 2, 2025 and sell it today you would earn a total of  56.00  from holding Scotiabank Peru SAA or generate 5.36% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	32.79%
Values	Daily Returns

DXC Technology Co  vs.  Scotiabank Peru SAA

DXC Technology

Risk-Adjusted Performance

Very Weak

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

Scotiabank Peru SAA

Risk-Adjusted Performance

Modest

Over the last 90 days Scotiabank Peru SAA has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather inconsistent basic indicators, Scotiabank Peru exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with DXC Technology and Scotiabank Peru

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

The idea behind DXC Technology Co and Scotiabank Peru SAA 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.

Check out your portfolio center.

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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.