Correlation Between Samsung Electronics and JW Shinyak
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and JW Shinyak 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 JW Shinyak 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 JW Shinyak, you can compare the effects of market volatilities on Samsung Electronics and JW Shinyak 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 JW Shinyak. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and JW Shinyak.
Diversification Opportunities for Samsung Electronics and JW Shinyak
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Samsung and 067290 is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and JW Shinyak in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JW Shinyak 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 JW Shinyak. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JW Shinyak has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and JW Shinyak go up and down completely randomly.
Pair Corralation between Samsung Electronics and JW Shinyak
Assuming the 90 days trading horizon Samsung Electronics Co is expected to generate 0.66 times more return on investment than JW Shinyak. However, Samsung Electronics Co is 1.52 times less risky than JW Shinyak. It trades about 0.0 of its potential returns per unit of risk. JW Shinyak is currently generating about -0.06 per unit of risk. If you would invest 5,136,065 in Samsung Electronics Co on August 27, 2024 and sell it today you would lose (326,065) from holding Samsung Electronics Co or give up 6.35% 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. JW Shinyak
Performance |
| Timeline |
| Samsung Electronics |
| JW Shinyak |
Samsung Electronics and JW Shinyak Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and JW Shinyak
The main advantage of trading using opposite Samsung Electronics and JW Shinyak positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, JW Shinyak 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 JW Shinyak will offset losses from the drop in JW Shinyak's long position.| Samsung Electronics vs. JYP Entertainment | Samsung Electronics vs. Samsung Heavy Industries | Samsung Electronics vs. Hanjinkal |
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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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