Correlation Between Samsung Securities and Doosan
Can any of the company-specific risk be diversified away by investing in both Samsung Securities and Doosan 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 Securities and Doosan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samsung Securities and Doosan, you can compare the effects of market volatilities on Samsung Securities and Doosan 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 Securities with a short position of Doosan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Securities and Doosan.
Diversification Opportunities for Samsung Securities and Doosan
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Samsung and Doosan is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Securities and Doosan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Doosan and Samsung Securities 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 Securities are associated (or correlated) with Doosan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Doosan has no effect on the direction of Samsung Securities i.e., Samsung Securities and Doosan go up and down completely randomly.
Pair Corralation between Samsung Securities and Doosan
Assuming the 90 days trading horizon Samsung Securities is expected to generate 4.27 times less return on investment than Doosan. But when comparing it to its historical volatility, Samsung Securities is 5.37 times less risky than Doosan. It trades about 0.27 of its potential returns per unit of risk. Doosan is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 26,500,000 in Doosan on November 3, 2024 and sell it today you would earn a total of 6,750,000 from holding Doosan or generate 25.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
Samsung Securities vs. Doosan
Performance |
| Timeline |
| Samsung Securities |
| Doosan |
Samsung Securities and Doosan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Securities and Doosan
The main advantage of trading using opposite Samsung Securities and Doosan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Securities position performs unexpectedly, Doosan 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 Doosan will offset losses from the drop in Doosan's long position.| Samsung Securities vs. Korea Information Communications | Samsung Securities vs. Netmarble Games Corp | Samsung Securities vs. KT Submarine Telecom | Samsung Securities vs. Kakao Games Corp |
| Doosan vs. Daelim Trading Co | Doosan vs. Golden Bridge Investment | Doosan vs. Daol Investment Securities | Doosan vs. Woori Technology Investment |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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