Correlation Between FORWARD AIR and Scout24 SE

Can any of the company-specific risk be diversified away by investing in both FORWARD AIR and Scout24 SE 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 FORWARD AIR and Scout24 SE into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between FORWARD AIR P and Scout24 SE, you can compare the effects of market volatilities on FORWARD AIR and Scout24 SE 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 FORWARD AIR with a short position of Scout24 SE. Check out your portfolio center. Please also check ongoing floating volatility patterns of FORWARD AIR and Scout24 SE.

Diversification Opportunities for FORWARD AIR and Scout24 SE

0.66

Correlation Coefficient

FORWARD AIR  Scout24 SE

Poor diversification

The 3 months correlation between FORWARD and Scout24 is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding FORWARD AIR P and Scout24 SE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Scout24 SE and FORWARD AIR 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 FORWARD AIR P are associated (or correlated) with Scout24 SE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Scout24 SE has no effect on the direction of FORWARD AIR i.e., FORWARD AIR and Scout24 SE go up and down completely randomly.

Pair Corralation between FORWARD AIR and Scout24 SE

Assuming the 90 days horizon FORWARD AIR P is expected to generate 3.95 times more return on investment than Scout24 SE. However, FORWARD AIR is 3.95 times more volatile than Scout24 SE. It trades about 0.22 of its potential returns per unit of risk. Scout24 SE is currently generating about 0.25 per unit of risk. If you would invest  1,330  in FORWARD AIR P on April 23, 2025 and sell it today you would earn a total of  985.00  from holding FORWARD AIR P or generate 74.06% return on investment over 90 days.

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

FORWARD AIR P  vs.  Scout24 SE

FORWARD AIR P

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in FORWARD AIR P are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, FORWARD AIR reported solid returns over the last few months and may actually be approaching a breakup point.

Scout24 SE

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Scout24 SE are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Scout24 SE reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with FORWARD AIR and Scout24 SE

The main advantage of trading using opposite FORWARD AIR and Scout24 SE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FORWARD AIR position performs unexpectedly, Scout24 SE 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 Scout24 SE will offset losses from the drop in Scout24 SE's long position.

The idea behind FORWARD AIR P and Scout24 SE 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 Transaction History module to view history of all your transactions and understand their impact on performance.