Correlation Between Samsung Electronics and Cuckoo Electronics
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Cuckoo 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 Samsung Electronics and Cuckoo Electronics 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 Cuckoo Electronics Co, you can compare the effects of market volatilities on Samsung Electronics and Cuckoo 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 Samsung Electronics with a short position of Cuckoo Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Cuckoo Electronics.
Diversification Opportunities for Samsung Electronics and Cuckoo Electronics
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Samsung and Cuckoo is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Cuckoo Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cuckoo Electronics 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 Cuckoo Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cuckoo Electronics has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Cuckoo Electronics go up and down completely randomly.
Pair Corralation between Samsung Electronics and Cuckoo Electronics
Assuming the 90 days trading horizon Samsung Electronics Co is expected to generate 2.04 times more return on investment than Cuckoo Electronics. However, Samsung Electronics is 2.04 times more volatile than Cuckoo Electronics Co. It trades about 0.01 of its potential returns per unit of risk. Cuckoo Electronics Co is currently generating about -0.11 per unit of risk. If you would invest 5,810,000 in Samsung Electronics Co on August 28, 2024 and sell it today you would lose (20,000) from holding Samsung Electronics Co or give up 0.34% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Samsung Electronics Co vs. Cuckoo Electronics Co
Performance |
| Timeline |
| Samsung Electronics |
| Cuckoo Electronics |
Samsung Electronics and Cuckoo Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Cuckoo Electronics
The main advantage of trading using opposite Samsung Electronics and Cuckoo Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Cuckoo 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 Cuckoo Electronics will offset losses from the drop in Cuckoo Electronics' long position.| Samsung Electronics vs. Lotte Fine Chemical | Samsung Electronics vs. SH Energy Chemical | Samsung Electronics vs. Hansol Chemical Co | Samsung Electronics vs. Youngchang Chemical Co |
| Cuckoo Electronics vs. Busan Industrial Co | Cuckoo Electronics vs. Busan Ind | Cuckoo Electronics vs. Mirae Asset Daewoo | Cuckoo Electronics vs. UNISEM 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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