Correlation Between Samsung Life and EBEST Investment
Can any of the company-specific risk be diversified away by investing in both Samsung Life and EBEST Investment 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 EBEST Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samsung Life and EBEST Investment Securities, you can compare the effects of market volatilities on Samsung Life and EBEST Investment 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 EBEST Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Life and EBEST Investment.
Diversification Opportunities for Samsung Life and EBEST Investment
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Samsung and EBEST is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Life and EBEST Investment Securities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EBEST Investment Sec 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 EBEST Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EBEST Investment Sec has no effect on the direction of Samsung Life i.e., Samsung Life and EBEST Investment go up and down completely randomly.
Pair Corralation between Samsung Life and EBEST Investment
Assuming the 90 days trading horizon Samsung Life is expected to generate 2.43 times more return on investment than EBEST Investment. However, Samsung Life is 2.43 times more volatile than EBEST Investment Securities. It trades about 0.04 of its potential returns per unit of risk. EBEST Investment Securities is currently generating about -0.23 per unit of risk. If you would invest 10,250,000 in Samsung Life on August 29, 2024 and sell it today you would earn a total of 210,000 from holding Samsung Life or generate 2.05% 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. EBEST Investment Securities
Performance |
| Timeline |
| Samsung Life |
| EBEST Investment Sec |
Samsung Life and EBEST Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Life and EBEST Investment
The main advantage of trading using opposite Samsung Life and EBEST Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Life position performs unexpectedly, EBEST Investment 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 EBEST Investment will offset losses from the drop in EBEST Investment's long position.| Samsung Life vs. Daejung Chemicals Metals | Samsung Life vs. Puloon Technology | Samsung Life vs. Lotte Chilsung Beverage | Samsung Life vs. Miwon Chemicals Co |
| EBEST Investment vs. DB Insurance Co | EBEST Investment vs. KakaoBank Corp | EBEST Investment vs. Pyung Hwa Industrial | EBEST Investment vs. Daiyang Metal 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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