Correlation Between Samyoung Electronics and LG Electronics
Can any of the company-specific risk be diversified away by investing in both Samyoung Electronics and LG Electronics 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 Samyoung Electronics and LG Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samyoung Electronics Co and LG Electronics, you can compare the effects of market volatilities on Samyoung Electronics and LG Electronics 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 Samyoung Electronics with a short position of LG Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samyoung Electronics and LG Electronics.
Diversification Opportunities for Samyoung Electronics and LG Electronics
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Samyoung and 066570 is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Samyoung Electronics Co and LG Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LG Electronics and Samyoung Electronics 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 Samyoung Electronics Co are associated (or correlated) with LG Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LG Electronics has no effect on the direction of Samyoung Electronics i.e., Samyoung Electronics and LG Electronics go up and down completely randomly.
Pair Corralation between Samyoung Electronics and LG Electronics
Assuming the 90 days trading horizon Samyoung Electronics Co is expected to generate 0.78 times more return on investment than LG Electronics. However, Samyoung Electronics Co is 1.28 times less risky than LG Electronics. It trades about 0.18 of its potential returns per unit of risk. LG Electronics is currently generating about -0.1 per unit of risk. If you would invest 968,000 in Samyoung Electronics Co on August 25, 2024 and sell it today you would earn a total of 52,000 from holding Samyoung Electronics Co or generate 5.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samyoung Electronics Co vs. LG Electronics
Performance |
| Timeline |
| Samyoung Electronics |
| LG Electronics |
Samyoung Electronics and LG Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samyoung Electronics and LG Electronics
The main advantage of trading using opposite Samyoung Electronics and LG Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samyoung Electronics position performs unexpectedly, LG Electronics 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 Electronics will offset losses from the drop in LG Electronics' long position.| Samyoung Electronics vs. AptaBio Therapeutics | Samyoung Electronics vs. Daewoo SBI SPAC | Samyoung Electronics vs. Dream Security co | Samyoung Electronics vs. Microfriend |
| LG Electronics vs. Youngchang Chemical Co | LG Electronics vs. Chin Yang Chemical | LG Electronics vs. DB Financial Investment | LG Electronics vs. Homecast CoLtd |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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