Correlation Between Samsung Fire and Digital Imaging
Can any of the company-specific risk be diversified away by investing in both Samsung Fire and Digital Imaging 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 Samsung Fire and Digital Imaging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samsung Fire Marine and Digital Imaging Technology, you can compare the effects of market volatilities on Samsung Fire and Digital Imaging 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 Samsung Fire with a short position of Digital Imaging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Fire and Digital Imaging.
Diversification Opportunities for Samsung Fire and Digital Imaging
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Samsung and Digital is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Fire Marine and Digital Imaging Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Digital Imaging Tech and Samsung Fire 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 Samsung Fire Marine are associated (or correlated) with Digital Imaging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Digital Imaging Tech has no effect on the direction of Samsung Fire i.e., Samsung Fire and Digital Imaging go up and down completely randomly.
Pair Corralation between Samsung Fire and Digital Imaging
Assuming the 90 days trading horizon Samsung Fire is expected to generate 1.79 times less return on investment than Digital Imaging. But when comparing it to its historical volatility, Samsung Fire Marine is 2.03 times less risky than Digital Imaging. It trades about 0.07 of its potential returns per unit of risk. Digital Imaging Technology is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 592,182 in Digital Imaging Technology on October 9, 2024 and sell it today you would earn a total of 782,818 from holding Digital Imaging Technology or generate 132.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Fire Marine vs. Digital Imaging Technology
Performance |
| Timeline |
| Samsung Fire Marine |
| Digital Imaging Tech |
Samsung Fire and Digital Imaging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Fire and Digital Imaging
The main advantage of trading using opposite Samsung Fire and Digital Imaging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Fire position performs unexpectedly, Digital Imaging 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 Digital Imaging will offset losses from the drop in Digital Imaging's long position.| Samsung Fire vs. Hana Financial | Samsung Fire vs. Woori Financial Group | Samsung Fire vs. Samsung Electronics Co | Samsung Fire vs. Samsung Electronics Co |
| Digital Imaging vs. Vina Technology Co | Digital Imaging vs. Daou Technology | Digital Imaging vs. Woori Financial Group | Digital Imaging vs. Incar Financial Service |
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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