Correlation Between Samsung Electronics and Oscotec
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Oscotec 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 Oscotec 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 Oscotec, you can compare the effects of market volatilities on Samsung Electronics and Oscotec 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 Oscotec. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Oscotec.
Diversification Opportunities for Samsung Electronics and Oscotec
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Samsung and Oscotec is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Oscotec in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oscotec 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 Oscotec. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oscotec has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Oscotec go up and down completely randomly.
Pair Corralation between Samsung Electronics and Oscotec
Assuming the 90 days trading horizon Samsung Electronics Co is expected to generate 1.32 times more return on investment than Oscotec. However, Samsung Electronics is 1.32 times more volatile than Oscotec. It trades about -0.05 of its potential returns per unit of risk. Oscotec is currently generating about -0.28 per unit of risk. If you would invest 4,800,000 in Samsung Electronics Co on September 2, 2024 and sell it today you would lose (180,000) from holding Samsung Electronics Co or give up 3.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. Oscotec
Performance |
| Timeline |
| Samsung Electronics |
| Oscotec |
Samsung Electronics and Oscotec Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Oscotec
The main advantage of trading using opposite Samsung Electronics and Oscotec positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Oscotec 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 Oscotec will offset losses from the drop in Oscotec's long position.| Samsung Electronics vs. LG Corp | Samsung Electronics vs. Busan Industrial Co | Samsung Electronics vs. Busan Ind | Samsung Electronics vs. Mirae Asset Daewoo |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |