Correlation Between Samsung Electronics and MediaZen
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and MediaZen 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 MediaZen 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 MediaZen, you can compare the effects of market volatilities on Samsung Electronics and MediaZen 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 MediaZen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and MediaZen.
Diversification Opportunities for Samsung Electronics and MediaZen
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Samsung and MediaZen is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and MediaZen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MediaZen 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 MediaZen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MediaZen has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and MediaZen go up and down completely randomly.
Pair Corralation between Samsung Electronics and MediaZen
Assuming the 90 days trading horizon Samsung Electronics Co is expected to generate 0.62 times more return on investment than MediaZen. However, Samsung Electronics Co is 1.62 times less risky than MediaZen. It trades about -0.05 of its potential returns per unit of risk. MediaZen is currently generating about -0.05 per unit of risk. If you would invest 6,188,677 in Samsung Electronics Co on August 25, 2024 and sell it today you would lose (1,378,677) from holding Samsung Electronics Co or give up 22.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.09% |
| Values | Daily Returns |
Samsung Electronics Co vs. MediaZen
Performance |
| Timeline |
| Samsung Electronics |
| MediaZen |
Samsung Electronics and MediaZen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and MediaZen
The main advantage of trading using opposite Samsung Electronics and MediaZen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, MediaZen 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 MediaZen will offset losses from the drop in MediaZen's long position.| Samsung Electronics vs. Mobileleader CoLtd | Samsung Electronics vs. Innowireless Co | Samsung Electronics vs. Daechang Steel Co | Samsung Electronics vs. Hanil Iron Steel |
| MediaZen vs. Samsung Electronics Co | MediaZen vs. Samsung Electronics Co | MediaZen vs. LG Energy Solution | MediaZen 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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