Correlation Between Samsung Electronics and NEXTIN
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and NEXTIN 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 NEXTIN 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 NEXTIN Inc, you can compare the effects of market volatilities on Samsung Electronics and NEXTIN 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 NEXTIN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and NEXTIN.
Diversification Opportunities for Samsung Electronics and NEXTIN
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between Samsung and NEXTIN is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and NEXTIN Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NEXTIN Inc 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 NEXTIN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NEXTIN Inc has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and NEXTIN go up and down completely randomly.
Pair Corralation between Samsung Electronics and NEXTIN
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the NEXTIN. But the stock apears to be less risky and, when comparing its historical volatility, Samsung Electronics Co is 1.8 times less risky than NEXTIN. The stock trades about 0.0 of its potential returns per unit of risk. The NEXTIN Inc is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 6,382,621 in NEXTIN Inc on November 27, 2024 and sell it today you would lose (1,002,621) from holding NEXTIN Inc or give up 15.71% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.78% |
| Values | Daily Returns |
Samsung Electronics Co vs. NEXTIN Inc
Performance |
| Timeline |
| Samsung Electronics |
| NEXTIN Inc |
Samsung Electronics and NEXTIN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and NEXTIN
The main advantage of trading using opposite Samsung Electronics and NEXTIN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, NEXTIN 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 NEXTIN will offset losses from the drop in NEXTIN'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 |
| NEXTIN vs. Parksystems Corp | NEXTIN vs. LEENO Industrial | NEXTIN vs. Tesna Inc | NEXTIN vs. Tokai Carbon Korea |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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