Correlation Between Samsung Electronics and Jinro Distillers
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Jinro Distillers 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 Electronics and Jinro Distillers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samsung Electronics Co and Jinro Distillers Co, you can compare the effects of market volatilities on Samsung Electronics and Jinro Distillers 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 Electronics with a short position of Jinro Distillers. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Jinro Distillers.
Diversification Opportunities for Samsung Electronics and Jinro Distillers
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Samsung and Jinro is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Jinro Distillers Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jinro Distillers and Samsung 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 Samsung Electronics Co are associated (or correlated) with Jinro Distillers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jinro Distillers has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Jinro Distillers go up and down completely randomly.
Pair Corralation between Samsung Electronics and Jinro Distillers
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the Jinro Distillers. In addition to that, Samsung Electronics is 2.69 times more volatile than Jinro Distillers Co. It trades about -0.12 of its total potential returns per unit of risk. Jinro Distillers Co is currently generating about -0.18 per unit of volatility. If you would invest 1,777,000 in Jinro Distillers Co on September 1, 2024 and sell it today you would lose (75,000) from holding Jinro Distillers Co or give up 4.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. Jinro Distillers Co
Performance |
| Timeline |
| Samsung Electronics |
| Jinro Distillers |
Samsung Electronics and Jinro Distillers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Jinro Distillers
The main advantage of trading using opposite Samsung Electronics and Jinro Distillers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Jinro Distillers 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 Jinro Distillers will offset losses from the drop in Jinro Distillers' long position.| Samsung Electronics vs. Konan Technology | Samsung Electronics vs. Orbitech Co | Samsung Electronics vs. Netmarble Games Corp | Samsung Electronics vs. Golden Bridge Investment |
| Jinro Distillers vs. LG Display Co | Jinro Distillers vs. Nam Hwa Construction | Jinro Distillers vs. Dongwoo Farm To | Jinro Distillers vs. GS Engineering Construction |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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