Correlation Between Iljin Materials and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both Iljin Materials and Samsung Electronics 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 Iljin Materials and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Iljin Materials Co and Samsung Electronics Co, you can compare the effects of market volatilities on Iljin Materials and Samsung Electronics 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 Iljin Materials with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Iljin Materials and Samsung Electronics.
Diversification Opportunities for Iljin Materials and Samsung Electronics
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Iljin and Samsung is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Iljin Materials Co and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and Iljin Materials 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 Iljin Materials Co are associated (or correlated) with Samsung Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samsung Electronics has no effect on the direction of Iljin Materials i.e., Iljin Materials and Samsung Electronics go up and down completely randomly.
Pair Corralation between Iljin Materials and Samsung Electronics
Assuming the 90 days trading horizon Iljin Materials Co is expected to under-perform the Samsung Electronics. In addition to that, Iljin Materials is 2.03 times more volatile than Samsung Electronics Co. It trades about -0.05 of its total potential returns per unit of risk. Samsung Electronics Co is currently generating about -0.01 per unit of volatility. If you would invest 5,370,916 in Samsung Electronics Co on August 29, 2024 and sell it today you would lose (470,916) from holding Samsung Electronics Co or give up 8.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Iljin Materials Co vs. Samsung Electronics Co
Performance |
| Timeline |
| Iljin Materials |
| Samsung Electronics |
Iljin Materials and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Iljin Materials and Samsung Electronics
The main advantage of trading using opposite Iljin Materials and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Iljin Materials position performs unexpectedly, Samsung Electronics 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 Electronics will offset losses from the drop in Samsung Electronics' long position.| Iljin Materials vs. Samsung Electronics Co | Iljin Materials vs. Samsung Electronics Co | Iljin Materials vs. LG Energy Solution | Iljin Materials vs. SK Hynix |
| Samsung Electronics vs. JYP Entertainment | Samsung Electronics vs. Samsung Heavy Industries | Samsung Electronics vs. Hanjinkal |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
Other Complementary Tools
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges |