Correlation Between Samsung Securities and ECSTELECOM
Can any of the company-specific risk be diversified away by investing in both Samsung Securities and ECSTELECOM 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 ECSTELECOM into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samsung Securities and ECSTELECOM Co, you can compare the effects of market volatilities on Samsung Securities and ECSTELECOM 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 ECSTELECOM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Securities and ECSTELECOM.
Diversification Opportunities for Samsung Securities and ECSTELECOM
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Samsung and ECSTELECOM is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Securities and ECSTELECOM Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ECSTELECOM 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 ECSTELECOM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ECSTELECOM has no effect on the direction of Samsung Securities i.e., Samsung Securities and ECSTELECOM go up and down completely randomly.
Pair Corralation between Samsung Securities and ECSTELECOM
Assuming the 90 days trading horizon Samsung Securities is expected to generate 0.79 times more return on investment than ECSTELECOM. However, Samsung Securities is 1.27 times less risky than ECSTELECOM. It trades about 0.27 of its potential returns per unit of risk. ECSTELECOM Co is currently generating about -0.06 per unit of risk. If you would invest 4,305,000 in Samsung Securities on November 3, 2024 and sell it today you would earn a total of 255,000 from holding Samsung Securities or generate 5.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 94.74% |
| Values | Daily Returns |
Samsung Securities vs. ECSTELECOM Co
Performance |
| Timeline |
| Samsung Securities |
| ECSTELECOM |
Samsung Securities and ECSTELECOM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Securities and ECSTELECOM
The main advantage of trading using opposite Samsung Securities and ECSTELECOM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Securities position performs unexpectedly, ECSTELECOM 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 ECSTELECOM will offset losses from the drop in ECSTELECOM'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 |
| ECSTELECOM vs. Daiyang Metal Co | ECSTELECOM vs. Daishin Information Communications | ECSTELECOM vs. Lotte Data Communication | ECSTELECOM vs. Hyunwoo Industrial Co |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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