Correlation Between Samsung SDI and Cuckoo Homesys
Can any of the company-specific risk be diversified away by investing in both Samsung SDI and Cuckoo Homesys 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 SDI and Cuckoo Homesys into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samsung SDI and Cuckoo Homesys Co, you can compare the effects of market volatilities on Samsung SDI and Cuckoo Homesys 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 SDI with a short position of Cuckoo Homesys. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung SDI and Cuckoo Homesys.
Diversification Opportunities for Samsung SDI and Cuckoo Homesys
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Samsung and Cuckoo is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Samsung SDI and Cuckoo Homesys Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cuckoo Homesys and Samsung SDI 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 SDI are associated (or correlated) with Cuckoo Homesys. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cuckoo Homesys has no effect on the direction of Samsung SDI i.e., Samsung SDI and Cuckoo Homesys go up and down completely randomly.
Pair Corralation between Samsung SDI and Cuckoo Homesys
Assuming the 90 days trading horizon Samsung SDI is expected to under-perform the Cuckoo Homesys. In addition to that, Samsung SDI is 1.6 times more volatile than Cuckoo Homesys Co. It trades about -0.07 of its total potential returns per unit of risk. Cuckoo Homesys Co is currently generating about -0.04 per unit of volatility. If you would invest 2,943,146 in Cuckoo Homesys Co on October 25, 2024 and sell it today you would lose (988,146) from holding Cuckoo Homesys Co or give up 33.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung SDI vs. Cuckoo Homesys Co
Performance |
| Timeline |
| Samsung SDI |
| Cuckoo Homesys |
Samsung SDI and Cuckoo Homesys Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung SDI and Cuckoo Homesys
The main advantage of trading using opposite Samsung SDI and Cuckoo Homesys positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung SDI position performs unexpectedly, Cuckoo Homesys 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 Cuckoo Homesys will offset losses from the drop in Cuckoo Homesys' long position.| Samsung SDI vs. Wireless Power Amplifier | Samsung SDI vs. Lion Chemtech Co | Samsung SDI vs. Hanjoo Light Metal | Samsung SDI vs. Spolytech Co |
| Cuckoo Homesys vs. PLAYWITH | Cuckoo Homesys vs. Dongnam Chemical Co | Cuckoo Homesys vs. Sangsin Energy Display | Cuckoo Homesys vs. Namhae Chemical |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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