Correlation Between Samsung Electronics and Showbox Corp
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Showbox Corp 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 Showbox Corp 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 Showbox Corp, you can compare the effects of market volatilities on Samsung Electronics and Showbox Corp 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 Showbox Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Showbox Corp.
Diversification Opportunities for Samsung Electronics and Showbox Corp
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Samsung and Showbox is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Showbox Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Showbox Corp 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 Showbox Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Showbox Corp has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Showbox Corp go up and down completely randomly.
Pair Corralation between Samsung Electronics and Showbox Corp
Assuming the 90 days trading horizon Samsung Electronics Co is expected to generate 0.47 times more return on investment than Showbox Corp. However, Samsung Electronics Co is 2.12 times less risky than Showbox Corp. It trades about 0.03 of its potential returns per unit of risk. Showbox Corp is currently generating about -0.11 per unit of risk. If you would invest 4,706,317 in Samsung Electronics Co on November 27, 2024 and sell it today you would earn a total of 93,683 from holding Samsung Electronics Co or generate 1.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.28% |
| Values | Daily Returns |
Samsung Electronics Co vs. Showbox Corp
Performance |
| Timeline |
| Samsung Electronics |
| Showbox Corp |
Samsung Electronics and Showbox Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Showbox Corp
The main advantage of trading using opposite Samsung Electronics and Showbox Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Showbox Corp 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 Showbox Corp will offset losses from the drop in Showbox Corp's long position.| Samsung Electronics vs. RFTech Co | Samsung Electronics vs. Jinro Distillers Co | Samsung Electronics vs. LS Materials | Samsung Electronics vs. Daejoo Electronic Materials |
| Showbox Corp vs. Haitai Confectionery Foods | Showbox Corp vs. Handok Clean Tech | Showbox Corp vs. Samyang Foods Co | Showbox Corp vs. Sejong Telecom |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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