Correlation Between Samsung Card and Lotte Non-Life
Can any of the company-specific risk be diversified away by investing in both Samsung Card and Lotte Non-Life 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 Card and Lotte Non-Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samsung Card Co and Lotte Non Life, you can compare the effects of market volatilities on Samsung Card and Lotte Non-Life 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 Card with a short position of Lotte Non-Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Card and Lotte Non-Life.
Diversification Opportunities for Samsung Card and Lotte Non-Life
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Samsung and Lotte is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Card Co and Lotte Non Life in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lotte Non Life and Samsung Card 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 Card Co are associated (or correlated) with Lotte Non-Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lotte Non Life has no effect on the direction of Samsung Card i.e., Samsung Card and Lotte Non-Life go up and down completely randomly.
Pair Corralation between Samsung Card and Lotte Non-Life
Assuming the 90 days trading horizon Samsung Card Co is expected to generate 0.52 times more return on investment than Lotte Non-Life. However, Samsung Card Co is 1.93 times less risky than Lotte Non-Life. It trades about 0.34 of its potential returns per unit of risk. Lotte Non Life is currently generating about -0.14 per unit of risk. If you would invest 4,200,000 in Samsung Card Co on November 27, 2024 and sell it today you would earn a total of 270,000 from holding Samsung Card Co or generate 6.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Card Co vs. Lotte Non Life
Performance |
| Timeline |
| Samsung Card |
| Lotte Non Life |
Samsung Card and Lotte Non-Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Card and Lotte Non-Life
The main advantage of trading using opposite Samsung Card and Lotte Non-Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Card position performs unexpectedly, Lotte Non-Life 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 Lotte Non-Life will offset losses from the drop in Lotte Non-Life's long position.| Samsung Card vs. UJU Electronics Co | Samsung Card vs. Daesung Hi Tech Co | Samsung Card vs. Sangshin Electronics Co | Samsung Card vs. DAEDUCK ELECTRONICS CoLtd |
| Lotte Non-Life vs. DC Media Co | Lotte Non-Life vs. Nasmedia Co | Lotte Non-Life vs. ChipsMedia | Lotte Non-Life vs. JYP Entertainment Corp |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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