Correlation Between Samsung Electronics and Jeong Moon
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Jeong Moon 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 Jeong Moon 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 Jeong Moon Information, you can compare the effects of market volatilities on Samsung Electronics and Jeong Moon 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 Jeong Moon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Jeong Moon.
Diversification Opportunities for Samsung Electronics and Jeong Moon
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Samsung and Jeong is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Jeong Moon Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jeong Moon Information 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 Jeong Moon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jeong Moon Information has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Jeong Moon go up and down completely randomly.
Pair Corralation between Samsung Electronics and Jeong Moon
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the Jeong Moon. But the stock apears to be less risky and, when comparing its historical volatility, Samsung Electronics Co is 1.01 times less risky than Jeong Moon. The stock trades about -0.34 of its potential returns per unit of risk. The Jeong Moon Information is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 80,900 in Jeong Moon Information on November 5, 2024 and sell it today you would earn a total of 2,300 from holding Jeong Moon Information or generate 2.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. Jeong Moon Information
Performance |
| Timeline |
| Samsung Electronics |
| Jeong Moon Information |
Samsung Electronics and Jeong Moon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Jeong Moon
The main advantage of trading using opposite Samsung Electronics and Jeong Moon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Jeong Moon 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 Jeong Moon will offset losses from the drop in Jeong Moon's long position.| Samsung Electronics vs. V One Tech Co | Samsung Electronics vs. SK Chemicals Co | Samsung Electronics vs. PNC Technologies co | Samsung Electronics vs. Mgame Corp |
| Jeong Moon vs. INFINITT Healthcare Co | Jeong Moon vs. Homecast CoLtd | Jeong Moon vs. Aprogen Healthcare Games | Jeong Moon vs. Handok Clean Tech |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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