Correlation Between Woori Technology and Samsung Life
Can any of the company-specific risk be diversified away by investing in both Woori Technology and Samsung 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 Woori Technology and Samsung Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Woori Technology and Samsung Life Insurance, you can compare the effects of market volatilities on Woori Technology and Samsung 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 Woori Technology with a short position of Samsung Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of Woori Technology and Samsung Life.
Diversification Opportunities for Woori Technology and Samsung Life
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Woori and Samsung is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Woori Technology and Samsung Life Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Life Insurance and Woori Technology 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 Woori Technology are associated (or correlated) with Samsung Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samsung Life Insurance has no effect on the direction of Woori Technology i.e., Woori Technology and Samsung Life go up and down completely randomly.
Pair Corralation between Woori Technology and Samsung Life
Assuming the 90 days trading horizon Woori Technology is expected to generate 0.91 times more return on investment than Samsung Life. However, Woori Technology is 1.1 times less risky than Samsung Life. It trades about 0.37 of its potential returns per unit of risk. Samsung Life Insurance is currently generating about -0.06 per unit of risk. If you would invest 177,200 in Woori Technology on November 5, 2024 and sell it today you would earn a total of 31,300 from holding Woori Technology or generate 17.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Woori Technology vs. Samsung Life Insurance
Performance |
| Timeline |
| Woori Technology |
| Samsung Life Insurance |
Woori Technology and Samsung Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Woori Technology and Samsung Life
The main advantage of trading using opposite Woori Technology and Samsung Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Woori Technology position performs unexpectedly, Samsung 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 Samsung Life will offset losses from the drop in Samsung Life's long position.| Woori Technology vs. Puloon Technology | Woori Technology vs. Daesung Industrial Co | Woori Technology vs. Industrial Bank | Woori Technology vs. Eagon Industrial Co |
| Samsung Life vs. Namhae Chemical | Samsung Life vs. Sung Bo Chemicals | Samsung Life vs. Dongil Metal Co | Samsung Life vs. Choil Aluminum |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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