Correlation Between Samsung Electronics and Dgb Financial
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Dgb Financial 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 Dgb Financial 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 Dgb Financial, you can compare the effects of market volatilities on Samsung Electronics and Dgb Financial 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 Dgb Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Dgb Financial.
Diversification Opportunities for Samsung Electronics and Dgb Financial
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Samsung and Dgb is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Dgb Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dgb Financial 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 Dgb Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dgb Financial has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Dgb Financial go up and down completely randomly.
Pair Corralation between Samsung Electronics and Dgb Financial
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the Dgb Financial. In addition to that, Samsung Electronics is 3.32 times more volatile than Dgb Financial. It trades about -0.05 of its total potential returns per unit of risk. Dgb Financial is currently generating about 0.41 per unit of volatility. If you would invest 822,000 in Dgb Financial on September 2, 2024 and sell it today you would earn a total of 65,000 from holding Dgb Financial or generate 7.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. Dgb Financial
Performance |
| Timeline |
| Samsung Electronics |
| Dgb Financial |
Samsung Electronics and Dgb Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Dgb Financial
The main advantage of trading using opposite Samsung Electronics and Dgb Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Dgb Financial 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 Dgb Financial will offset losses from the drop in Dgb Financial'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 |
| Dgb Financial vs. Samsung Electronics Co | Dgb Financial vs. Samsung Electronics Co | Dgb Financial vs. KB Financial Group | Dgb Financial vs. Shinhan Financial Group |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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