Correlation Between Liberty Broadband and ScanSource
Can any of the company-specific risk be diversified away by investing in both Liberty Broadband 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 Liberty Broadband and ScanSource into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Liberty Broadband Corp and ScanSource, you can compare the effects of market volatilities on Liberty Broadband 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 Liberty Broadband with a short position of ScanSource. Check out your portfolio center. Please also check ongoing floating volatility patterns of Liberty Broadband and ScanSource.
Diversification Opportunities for Liberty Broadband and ScanSource
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Liberty and ScanSource is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Liberty Broadband Corp and ScanSource in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ScanSource and Liberty Broadband 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 Liberty Broadband Corp 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 Liberty Broadband i.e., Liberty Broadband and ScanSource go up and down completely randomly.
Pair Corralation between Liberty Broadband and ScanSource
Assuming the 90 days horizon Liberty Broadband Corp is expected to under-perform the ScanSource. But the preferred stock apears to be less risky and, when comparing its historical volatility, Liberty Broadband Corp is 4.94 times less risky than ScanSource. The preferred stock trades about -0.02 of its potential returns per unit of risk. The ScanSource is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 4,041 in ScanSource on July 20, 2025 and sell it today you would earn a total of 118.00 from holding ScanSource or generate 2.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Liberty Broadband Corp vs. ScanSource
Performance |
| Timeline |
| Liberty Broadband Corp |
| ScanSource |
Liberty Broadband and ScanSource Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Liberty Broadband and ScanSource
The main advantage of trading using opposite Liberty Broadband and ScanSource positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Liberty Broadband 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.| Liberty Broadband vs. SK Telecom Co | Liberty Broadband vs. KT Corporation | Liberty Broadband vs. Millicom International Cellular | Liberty Broadband vs. Lumen Technologies |
| ScanSource vs. NETGEAR | ScanSource vs. Magic Software Enterprises | ScanSource vs. Stratasys | ScanSource vs. Alpha and Omega |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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