Correlation Between Samhyun Steel and Samsung Special
Can any of the company-specific risk be diversified away by investing in both Samhyun Steel and Samsung Special 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 Samhyun Steel and Samsung Special into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samhyun Steel Co and Samsung Special Purpose, you can compare the effects of market volatilities on Samhyun Steel and Samsung Special 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 Samhyun Steel with a short position of Samsung Special. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samhyun Steel and Samsung Special.
Diversification Opportunities for Samhyun Steel and Samsung Special
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Samhyun and Samsung is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Samhyun Steel Co and Samsung Special Purpose in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Special Purpose and Samhyun Steel 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 Samhyun Steel Co are associated (or correlated) with Samsung Special. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samsung Special Purpose has no effect on the direction of Samhyun Steel i.e., Samhyun Steel and Samsung Special go up and down completely randomly.
Pair Corralation between Samhyun Steel and Samsung Special
Assuming the 90 days trading horizon Samhyun Steel Co is expected to generate 1.03 times more return on investment than Samsung Special. However, Samhyun Steel is 1.03 times more volatile than Samsung Special Purpose. It trades about -0.01 of its potential returns per unit of risk. Samsung Special Purpose is currently generating about -0.02 per unit of risk. If you would invest 471,226 in Samhyun Steel Co on September 4, 2024 and sell it today you would lose (23,226) from holding Samhyun Steel Co or give up 4.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.65% |
| Values | Daily Returns |
Samhyun Steel Co vs. Samsung Special Purpose
Performance |
| Timeline |
| Samhyun Steel |
| Samsung Special Purpose |
Samhyun Steel and Samsung Special Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samhyun Steel and Samsung Special
The main advantage of trading using opposite Samhyun Steel and Samsung Special positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samhyun Steel position performs unexpectedly, Samsung Special 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 Samsung Special will offset losses from the drop in Samsung Special's long position.| Samhyun Steel vs. Keum Kang Steel | Samhyun Steel vs. Tplex Co | Samhyun Steel vs. Gyeongnam Steel Co | Samhyun Steel vs. Daedong Steel Co |
| Samsung Special vs. Nh Investment And | Samsung Special vs. Hanwha InvestmentSecurities Co | Samsung Special vs. YeSUN Tech CoLtd |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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