Correlation Between Rogers and ScanSource

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

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

Diversification Opportunities for Rogers and ScanSource

0.56

Correlation Coefficient

Rogers  ScanSource

Very weak diversification

The 3 months correlation between Rogers and ScanSource is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Rogers and ScanSource in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ScanSource and Rogers 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 Rogers 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 Rogers i.e., Rogers and ScanSource go up and down completely randomly.

Pair Corralation between Rogers and ScanSource

Considering the 90-day investment horizon Rogers is expected to generate 1.35 times more return on investment than ScanSource. However, Rogers is 1.35 times more volatile than ScanSource. It trades about 0.0 of its potential returns per unit of risk. ScanSource is currently generating about -0.01 per unit of risk. If you would invest  7,100  in Rogers on May 13, 2025 and sell it today you would lose (79.00) from holding Rogers or give up 1.11% of portfolio value over 90 days.

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

Rogers  vs.  ScanSource

Rogers

Risk-Adjusted Performance

Weakest

Over the last 90 days Rogers has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Rogers is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

ScanSource

Risk-Adjusted Performance

Weakest

Over the last 90 days ScanSource has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, ScanSource is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Rogers and ScanSource

The main advantage of trading using opposite Rogers and ScanSource positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rogers 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 Rogers 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.

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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 Anywhere module to track or share privately all of your investments from the convenience of any device.