Correlation Between Samsung Electronics and INtRON Biotechnology
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and INtRON Biotechnology 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 INtRON Biotechnology 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 iNtRON Biotechnology, you can compare the effects of market volatilities on Samsung Electronics and INtRON Biotechnology 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 INtRON Biotechnology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and INtRON Biotechnology.
Diversification Opportunities for Samsung Electronics and INtRON Biotechnology
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Samsung and INtRON is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and iNtRON Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iNtRON Biotechnology 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 INtRON Biotechnology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iNtRON Biotechnology has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and INtRON Biotechnology go up and down completely randomly.
Pair Corralation between Samsung Electronics and INtRON Biotechnology
Assuming the 90 days trading horizon Samsung Electronics Co is expected to generate 1.31 times more return on investment than INtRON Biotechnology. However, Samsung Electronics is 1.31 times more volatile than iNtRON Biotechnology. It trades about 0.02 of its potential returns per unit of risk. iNtRON Biotechnology is currently generating about -0.07 per unit of risk. If you would invest 4,880,000 in Samsung Electronics Co on August 29, 2024 and sell it today you would earn a total of 20,000 from holding Samsung Electronics Co or generate 0.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. iNtRON Biotechnology
Performance |
| Timeline |
| Samsung Electronics |
| iNtRON Biotechnology |
Samsung Electronics and INtRON Biotechnology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and INtRON Biotechnology
The main advantage of trading using opposite Samsung Electronics and INtRON Biotechnology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, INtRON Biotechnology 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 INtRON Biotechnology will offset losses from the drop in INtRON Biotechnology's long position.| Samsung Electronics vs. Nice Information Telecommunication | Samsung Electronics vs. Mobile Appliance | Samsung Electronics vs. Korea Shipbuilding Offshore | Samsung Electronics vs. Daou Technology |
| INtRON Biotechnology vs. Samsung Electronics Co | INtRON Biotechnology vs. Samsung Electronics Co | INtRON Biotechnology vs. LG Energy Solution | INtRON Biotechnology 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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