Correlation Between Samsung Electronics and DIGITAL CHOSUN
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and DIGITAL CHOSUN 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 DIGITAL CHOSUN 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 DIGITAL CHOSUN, you can compare the effects of market volatilities on Samsung Electronics and DIGITAL CHOSUN 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 DIGITAL CHOSUN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and DIGITAL CHOSUN.
Diversification Opportunities for Samsung Electronics and DIGITAL CHOSUN
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Samsung and DIGITAL is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and DIGITAL CHOSUN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DIGITAL CHOSUN 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 DIGITAL CHOSUN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DIGITAL CHOSUN has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and DIGITAL CHOSUN go up and down completely randomly.
Pair Corralation between Samsung Electronics and DIGITAL CHOSUN
Assuming the 90 days trading horizon Samsung Electronics Co is expected to generate 0.79 times more return on investment than DIGITAL CHOSUN. However, Samsung Electronics Co is 1.27 times less risky than DIGITAL CHOSUN. It trades about 0.0 of its potential returns per unit of risk. DIGITAL CHOSUN is currently generating about -0.03 per unit of risk. If you would invest 6,120,280 in Samsung Electronics Co on October 15, 2024 and sell it today you would lose (590,280) from holding Samsung Electronics Co or give up 9.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. DIGITAL CHOSUN
Performance |
| Timeline |
| Samsung Electronics |
| DIGITAL CHOSUN |
Samsung Electronics and DIGITAL CHOSUN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and DIGITAL CHOSUN
The main advantage of trading using opposite Samsung Electronics and DIGITAL CHOSUN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, DIGITAL CHOSUN 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 CHOSUN will offset losses from the drop in DIGITAL CHOSUN's long position.| Samsung Electronics vs. ENERGYMACHINERY KOREA CoLtd | Samsung Electronics vs. Dongwoo Farm To | Samsung Electronics vs. Hanwha Life Insurance | Samsung Electronics vs. KCC Engineering Construction |
| DIGITAL CHOSUN vs. N2Tech Co | DIGITAL CHOSUN vs. Lion Chemtech Co | DIGITAL CHOSUN vs. Hankook Furniture Co | DIGITAL CHOSUN vs. A Tech Solution Co |
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 CEOs Directory module to screen CEOs from public companies around the world.
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