Correlation Between Samsung Electronics and Jahwa Electron
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Jahwa Electron 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 Jahwa Electron 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 Jahwa Electron, you can compare the effects of market volatilities on Samsung Electronics and Jahwa Electron 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 Jahwa Electron. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Jahwa Electron.
Diversification Opportunities for Samsung Electronics and Jahwa Electron
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Samsung and Jahwa is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Jahwa Electron in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jahwa Electron 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 Jahwa Electron. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jahwa Electron has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Jahwa Electron go up and down completely randomly.
Pair Corralation between Samsung Electronics and Jahwa Electron
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the Jahwa Electron. But the stock apears to be less risky and, when comparing its historical volatility, Samsung Electronics Co is 3.73 times less risky than Jahwa Electron. The stock trades about -0.36 of its potential returns per unit of risk. The Jahwa Electron is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest 1,247,000 in Jahwa Electron on November 6, 2024 and sell it today you would earn a total of 298,000 from holding Jahwa Electron or generate 23.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. Jahwa Electron
Performance |
| Timeline |
| Samsung Electronics |
| Jahwa Electron |
Samsung Electronics and Jahwa Electron Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Jahwa Electron
The main advantage of trading using opposite Samsung Electronics and Jahwa Electron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Jahwa Electron 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 Jahwa Electron will offset losses from the drop in Jahwa Electron's 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 |
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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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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