Correlation Between ScanSource and Civista Bancshares

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

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

Diversification Opportunities for ScanSource and Civista Bancshares

0.17

Correlation Coefficient

ScanSource  Civista Bancshares

Average diversification

The 3 months correlation between ScanSource and Civista is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding ScanSource and Civista Bancshares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Civista Bancshares and ScanSource 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 ScanSource are associated (or correlated) with Civista Bancshares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Civista Bancshares has no effect on the direction of ScanSource i.e., ScanSource and Civista Bancshares go up and down completely randomly.

Pair Corralation between ScanSource and Civista Bancshares

Given the investment horizon of 90 days ScanSource is expected to generate 0.74 times more return on investment than Civista Bancshares. However, ScanSource is 1.36 times less risky than Civista Bancshares. It trades about 0.11 of its potential returns per unit of risk. Civista Bancshares is currently generating about -0.09 per unit of risk. If you would invest  3,448  in ScanSource on May 2, 2025 and sell it today you would earn a total of  436.00  from holding ScanSource or generate 12.65% return on investment over 90 days.

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

ScanSource  vs.  Civista Bancshares

ScanSource

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in ScanSource are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of rather unfluctuating basic indicators, ScanSource exhibited solid returns over the last few months and may actually be approaching a breakup point.

Civista Bancshares

Risk-Adjusted Performance

Very Weak

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

Pair Trading with ScanSource and Civista Bancshares

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

The idea behind ScanSource and Civista Bancshares 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.