Correlation Between Samsung Electronics and Interflex
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Interflex 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 Interflex 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 Interflex Co, you can compare the effects of market volatilities on Samsung Electronics and Interflex 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 Interflex. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Interflex.
Diversification Opportunities for Samsung Electronics and Interflex
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Samsung and Interflex is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Interflex Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Interflex 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 Interflex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Interflex has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Interflex go up and down completely randomly.
Pair Corralation between Samsung Electronics and Interflex
Assuming the 90 days trading horizon Samsung Electronics Co is expected to generate 1.0 times more return on investment than Interflex. However, Samsung Electronics is 1.0 times more volatile than Interflex Co. It trades about 0.04 of its potential returns per unit of risk. Interflex Co is currently generating about -0.11 per unit of risk. If you would invest 5,300,000 in Samsung Electronics Co on September 13, 2024 and sell it today you would earn a total of 100,000 from holding Samsung Electronics Co or generate 1.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. Interflex Co
Performance |
| Timeline |
| Samsung Electronics |
| Interflex |
Samsung Electronics and Interflex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Interflex
The main advantage of trading using opposite Samsung Electronics and Interflex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Interflex 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 Interflex will offset losses from the drop in Interflex's long position.| Samsung Electronics vs. Korea Air Svc | Samsung Electronics vs. Display Tech Co | Samsung Electronics vs. PLAYWITH | Samsung Electronics vs. Chorokbaem Healthcare Co |
| Interflex vs. Cube Entertainment | Interflex vs. Dreamus Company | Interflex vs. LG Energy Solution | Interflex vs. Dongwon System |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
Other Complementary Tools
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |