Correlation Between SK TELECOM and SCANSOURCE

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

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

Diversification Opportunities for SK TELECOM and SCANSOURCE

-0.35

Correlation Coefficient

SK TELECOM  SCANSOURCE

Very good diversification

The 3 months correlation between KMBA and SCANSOURCE is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding SK TELECOM TDADR and SCANSOURCE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SCANSOURCE and SK TELECOM 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 SK TELECOM TDADR are associated (or correlated) with SCANSOURCE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SCANSOURCE has no effect on the direction of SK TELECOM i.e., SK TELECOM and SCANSOURCE go up and down completely randomly.

Pair Corralation between SK TELECOM and SCANSOURCE

Assuming the 90 days trading horizon SK TELECOM TDADR is expected to generate 1.18 times more return on investment than SCANSOURCE. However, SK TELECOM is 1.18 times more volatile than SCANSOURCE. It trades about 0.06 of its potential returns per unit of risk. SCANSOURCE is currently generating about 0.01 per unit of risk. If you would invest  1,760  in SK TELECOM TDADR on May 16, 2025 and sell it today you would earn a total of  110.00  from holding SK TELECOM TDADR or generate 6.25% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

SK TELECOM TDADR  vs.  SCANSOURCE

SK TELECOM TDADR

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in SK TELECOM TDADR are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain fundamental drivers, SK TELECOM may actually be approaching a critical reversion point that can send shares even higher in September 2025.

SCANSOURCE

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in SCANSOURCE are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable basic indicators, SCANSOURCE is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with SK TELECOM and SCANSOURCE

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

The idea behind SK TELECOM TDADR and SCANSOURCE 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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.