Correlation Between Samsung Life and UJU Electronics
Can any of the company-specific risk be diversified away by investing in both Samsung Life and UJU 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 Samsung Life and UJU Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samsung Life and UJU Electronics Co, you can compare the effects of market volatilities on Samsung Life and UJU 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 Samsung Life with a short position of UJU Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Life and UJU Electronics.
Diversification Opportunities for Samsung Life and UJU Electronics
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Samsung and UJU is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Life and UJU Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UJU Electronics and Samsung Life 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 Life are associated (or correlated) with UJU Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UJU Electronics has no effect on the direction of Samsung Life i.e., Samsung Life and UJU Electronics go up and down completely randomly.
Pair Corralation between Samsung Life and UJU Electronics
Assuming the 90 days trading horizon Samsung Life is expected to generate 1.18 times more return on investment than UJU Electronics. However, Samsung Life is 1.18 times more volatile than UJU Electronics Co. It trades about 0.1 of its potential returns per unit of risk. UJU Electronics Co is currently generating about -0.25 per unit of risk. If you would invest 9,910,000 in Samsung Life on August 24, 2024 and sell it today you would earn a total of 550,000 from holding Samsung Life or generate 5.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Life vs. UJU Electronics Co
Performance |
| Timeline |
| Samsung Life |
| UJU Electronics |
Samsung Life and UJU Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Life and UJU Electronics
The main advantage of trading using opposite Samsung Life and UJU Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Life position performs unexpectedly, UJU 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 UJU Electronics will offset losses from the drop in UJU Electronics' long position.| Samsung Life vs. Kukdong Oil Chemicals | Samsung Life vs. Innowireless Co | Samsung Life vs. LG Chemicals | Samsung Life vs. Dongbang Transport Logistics |
| UJU Electronics vs. Seoul Semiconductor Co | UJU Electronics vs. SFA Engineering | UJU Electronics vs. Busan Industrial Co | UJU Electronics vs. Busan Ind |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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