Correlation Between Highbroad Advanced and ScanSource

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

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

Diversification Opportunities for Highbroad Advanced and ScanSource

0.69

Correlation Coefficient

Highbroad Advanced  ScanSource

Poor diversification

The 3 months correlation between Highbroad and ScanSource is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Highbroad Advanced Material and ScanSource in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ScanSource and Highbroad Advanced 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 Highbroad Advanced Material 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 Highbroad Advanced i.e., Highbroad Advanced and ScanSource go up and down completely randomly.

Pair Corralation between Highbroad Advanced and ScanSource

Assuming the 90 days trading horizon Highbroad Advanced Material is expected to under-perform the ScanSource. In addition to that, Highbroad Advanced is 1.14 times more volatile than ScanSource. It trades about -0.12 of its total potential returns per unit of risk. ScanSource is currently generating about -0.06 per unit of volatility. If you would invest  4,357  in ScanSource on August 26, 2025 and sell it today you would lose (337.00) from holding ScanSource or give up 7.73% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	92.19%
Values	Daily Returns

Highbroad Advanced Material  vs.  ScanSource

Highbroad Advanced

Risk-Adjusted Performance

Weakest

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

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 latest fragile performance, the Stock's basic indicators remain sound and the latest tumult on Wall Street may also be a sign of longer-term gains for the firm shareholders.

Pair Trading with Highbroad Advanced and ScanSource

The main advantage of trading using opposite Highbroad Advanced and ScanSource positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Highbroad Advanced 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 Highbroad Advanced Material 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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.