Correlation Between Samsung Card and Korea New
Can any of the company-specific risk be diversified away by investing in both Samsung Card and Korea New 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 Korea New 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 Korea New Network, you can compare the effects of market volatilities on Samsung Card and Korea New 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 Korea New. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Card and Korea New.
Diversification Opportunities for Samsung Card and Korea New
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Samsung and Korea is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Card Co and Korea New Network in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Korea New Network 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 Korea New. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Korea New Network has no effect on the direction of Samsung Card i.e., Samsung Card and Korea New go up and down completely randomly.
Pair Corralation between Samsung Card and Korea New
Assuming the 90 days trading horizon Samsung Card Co is expected to generate 0.79 times more return on investment than Korea New. However, Samsung Card Co is 1.26 times less risky than Korea New. It trades about 0.18 of its potential returns per unit of risk. Korea New Network is currently generating about -0.16 per unit of risk. If you would invest 4,040,000 in Samsung Card Co on September 1, 2024 and sell it today you would earn a total of 230,000 from holding Samsung Card Co or generate 5.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Samsung Card Co vs. Korea New Network
Performance |
| Timeline |
| Samsung Card |
| Korea New Network |
Samsung Card and Korea New Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Card and Korea New
The main advantage of trading using opposite Samsung Card and Korea New positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Card position performs unexpectedly, Korea New 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 Korea New will offset losses from the drop in Korea New's long position.| Samsung Card vs. Gyeongnam Steel Co | Samsung Card vs. Playgram Co | Samsung Card vs. Hyundai Home Shopping | Samsung Card vs. Home Center Holdings |
| Korea New vs. KT Submarine Telecom | Korea New vs. SK Telecom Co | Korea New vs. Formetal Co | Korea New vs. Innowireless 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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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