Correlation Between Transport International and ScanSource

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

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

Diversification Opportunities for Transport International and ScanSource

-0.02

Correlation Coefficient

Transport International  ScanSource

Good diversification

The 3 months correlation between Transport and ScanSource is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Transport International Holdin and ScanSource in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ScanSource and Transport International 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 Transport International Holdings 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 Transport International i.e., Transport International and ScanSource go up and down completely randomly.

Pair Corralation between Transport International and ScanSource

Assuming the 90 days horizon Transport International is expected to generate 1.89 times less return on investment than ScanSource. In addition to that, Transport International is 1.79 times more volatile than ScanSource. It trades about 0.02 of its total potential returns per unit of risk. ScanSource is currently generating about 0.07 per unit of volatility. If you would invest  3,560  in ScanSource on May 18, 2025 and sell it today you would earn a total of  280.00  from holding ScanSource or generate 7.87% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.48%
Values	Daily Returns

Transport International Holdin  vs.  ScanSource

Transport International

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Transport International Holdings are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Transport International is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

ScanSource

Risk-Adjusted Performance

Mild

Compared to the overall equity markets, risk-adjusted returns on investments in ScanSource are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, ScanSource may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Transport International and ScanSource

The main advantage of trading using opposite Transport International and ScanSource positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Transport International 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 Transport International Holdings 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.