Correlation Between PLAYWITH and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both PLAYWITH 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 PLAYWITH and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PLAYWITH and Samsung Electronics Co, you can compare the effects of market volatilities on PLAYWITH 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 PLAYWITH with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of PLAYWITH and Samsung Electronics.
Diversification Opportunities for PLAYWITH and Samsung Electronics
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between PLAYWITH and Samsung is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding PLAYWITH and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and PLAYWITH 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 PLAYWITH 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 PLAYWITH i.e., PLAYWITH and Samsung Electronics go up and down completely randomly.
Pair Corralation between PLAYWITH and Samsung Electronics
Assuming the 90 days trading horizon PLAYWITH is expected to generate 43.75 times less return on investment than Samsung Electronics. But when comparing it to its historical volatility, PLAYWITH is 1.04 times less risky than Samsung Electronics. It trades about 0.0 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 5,060,000 in Samsung Electronics Co on September 14, 2024 and sell it today you would earn a total of 530,000 from holding Samsung Electronics Co or generate 10.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
PLAYWITH vs. Samsung Electronics Co
Performance |
| Timeline |
| PLAYWITH |
| Samsung Electronics |
PLAYWITH and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PLAYWITH and Samsung Electronics
The main advantage of trading using opposite PLAYWITH and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PLAYWITH 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.| PLAYWITH vs. YG Entertainment | PLAYWITH vs. JYP Entertainment | PLAYWITH vs. Cube Entertainment | PLAYWITH vs. FNC Entertainment Co |
| Samsung Electronics vs. Anam Electronics Co | Samsung Electronics vs. Daejoo Electronic Materials | Samsung Electronics vs. CG Hi Tech | Samsung Electronics vs. Samsung Electronics 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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