Correlation Between Samsung Electronics and Stic Investments
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Stic Investments 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 Stic Investments 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 Stic Investments, you can compare the effects of market volatilities on Samsung Electronics and Stic Investments 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 Stic Investments. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Stic Investments.
Diversification Opportunities for Samsung Electronics and Stic Investments
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Samsung and Stic is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Stic Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stic Investments 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 Stic Investments. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stic Investments has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Stic Investments go up and down completely randomly.
Pair Corralation between Samsung Electronics and Stic Investments
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the Stic Investments. In addition to that, Samsung Electronics is 1.11 times more volatile than Stic Investments. It trades about -0.08 of its total potential returns per unit of risk. Stic Investments is currently generating about 0.04 per unit of volatility. If you would invest 795,000 in Stic Investments on November 6, 2024 and sell it today you would earn a total of 30,000 from holding Stic Investments or generate 3.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. Stic Investments
Performance |
| Timeline |
| Samsung Electronics |
| Stic Investments |
Samsung Electronics and Stic Investments Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Stic Investments
The main advantage of trading using opposite Samsung Electronics and Stic Investments positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Stic Investments 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 Stic Investments will offset losses from the drop in Stic Investments' long position.| Samsung Electronics vs. Daejung Chemicals Metals | Samsung Electronics vs. Asiana Airlines | Samsung Electronics vs. Inzi Display CoLtd | Samsung Electronics vs. Shin Steel Co |
| Stic Investments vs. Hyunwoo Industrial Co | Stic Investments vs. Namhae Chemical | Stic Investments vs. Youl Chon Chemical | Stic Investments vs. Kg Chemical |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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