Correlation Between SCANSOURCE and Adtalem Global

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

By analyzing existing cross correlation between SCANSOURCE and Adtalem Global Education, you can compare the effects of market volatilities on SCANSOURCE and Adtalem Global 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 Adtalem Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of SCANSOURCE and Adtalem Global.

Diversification Opportunities for SCANSOURCE and Adtalem Global

0.75

Correlation Coefficient

SCANSOURCE  Adtalem Global

Poor diversification

The 3 months correlation between SCANSOURCE and Adtalem is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding SCANSOURCE and Adtalem Global Education in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Adtalem Global Education 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 Adtalem Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Adtalem Global Education has no effect on the direction of SCANSOURCE i.e., SCANSOURCE and Adtalem Global go up and down completely randomly.

Pair Corralation between SCANSOURCE and Adtalem Global

Assuming the 90 days trading horizon SCANSOURCE is expected to generate 0.68 times more return on investment than Adtalem Global. However, SCANSOURCE is 1.46 times less risky than Adtalem Global. It trades about 0.16 of its potential returns per unit of risk. Adtalem Global Education is currently generating about 0.05 per unit of risk. If you would invest  2,800  in SCANSOURCE on April 23, 2025 and sell it today you would earn a total of  620.00  from holding SCANSOURCE or generate 22.14% return on investment over 90 days.

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

SCANSOURCE  vs.  Adtalem Global Education

SCANSOURCE

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in SCANSOURCE are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, SCANSOURCE unveiled solid returns over the last few months and may actually be approaching a breakup point.

Adtalem Global Education

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Adtalem Global Education are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, Adtalem Global may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Pair Trading with SCANSOURCE and Adtalem Global

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

The idea behind SCANSOURCE and Adtalem Global Education 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.