Correlation Between Samsung Electronics and Cots Technology
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Cots Technology 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 Cots Technology 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 Cots Technology Co, you can compare the effects of market volatilities on Samsung Electronics and Cots Technology 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 Cots Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Cots Technology.
Diversification Opportunities for Samsung Electronics and Cots Technology
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Samsung and Cots is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Cots Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cots Technology 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 Cots Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cots Technology has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Cots Technology go up and down completely randomly.
Pair Corralation between Samsung Electronics and Cots Technology
Assuming the 90 days trading horizon Samsung Electronics Co is expected to generate 0.64 times more return on investment than Cots Technology. However, Samsung Electronics Co is 1.56 times less risky than Cots Technology. It trades about -0.04 of its potential returns per unit of risk. Cots Technology Co is currently generating about -0.03 per unit of risk. If you would invest 6,150,000 in Samsung Electronics Co on August 29, 2024 and sell it today you would lose (320,000) from holding Samsung Electronics Co or give up 5.2% 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. Cots Technology Co
Performance |
| Timeline |
| Samsung Electronics |
| Cots Technology |
Samsung Electronics and Cots Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Cots Technology
The main advantage of trading using opposite Samsung Electronics and Cots Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Cots Technology 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 Cots Technology will offset losses from the drop in Cots Technology's long position.| Samsung Electronics vs. Chin Yang Chemical | Samsung Electronics vs. Dongbang Transport Logistics | Samsung Electronics vs. Shinhan Inverse Silver | Samsung Electronics vs. JC Chemical Co |
| Cots Technology vs. Samsung Electronics Co | Cots Technology vs. Samsung Electronics Co | Cots Technology vs. LG Energy Solution | Cots Technology vs. SK Hynix |
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.
Other Complementary Tools
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |