Correlation Between Samick Musical and LG Display
Can any of the company-specific risk be diversified away by investing in both Samick Musical and LG Display 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 Samick Musical and LG Display into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samick Musical Instruments and LG Display Co, you can compare the effects of market volatilities on Samick Musical and LG Display 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 Samick Musical with a short position of LG Display. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samick Musical and LG Display.
Diversification Opportunities for Samick Musical and LG Display
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Samick and 034220 is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Samick Musical Instruments and LG Display Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LG Display and Samick Musical 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 Samick Musical Instruments are associated (or correlated) with LG Display. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LG Display has no effect on the direction of Samick Musical i.e., Samick Musical and LG Display go up and down completely randomly.
Pair Corralation between Samick Musical and LG Display
Assuming the 90 days trading horizon Samick Musical Instruments is expected to generate 0.33 times more return on investment than LG Display. However, Samick Musical Instruments is 3.05 times less risky than LG Display. It trades about 0.26 of its potential returns per unit of risk. LG Display Co is currently generating about -0.27 per unit of risk. If you would invest 107,800 in Samick Musical Instruments on September 4, 2024 and sell it today you would earn a total of 3,000 from holding Samick Musical Instruments or generate 2.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samick Musical Instruments vs. LG Display Co
Performance |
| Timeline |
| Samick Musical Instr |
| LG Display |
Samick Musical and LG Display Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samick Musical and LG Display
The main advantage of trading using opposite Samick Musical and LG Display positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samick Musical position performs unexpectedly, LG Display 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 LG Display will offset losses from the drop in LG Display's long position.| Samick Musical vs. Pureun Mutual Savings | Samick Musical vs. Korea Shipbuilding Offshore | Samick Musical vs. Kukdong Oil Chemicals | Samick Musical vs. Sung Bo Chemicals |
| LG Display vs. AptaBio Therapeutics | LG Display vs. Daewoo SBI SPAC | LG Display vs. Dream Security co | LG Display vs. Microfriend |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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