Correlation Between Samsung Life and Alton Sports

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Samsung Life and Alton Sports 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 Alton Sports into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samsung Life and Alton Sports CoLtd, you can compare the effects of market volatilities on Samsung Life and Alton Sports 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 Alton Sports. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Life and Alton Sports.

Diversification Opportunities for Samsung Life and Alton Sports

SamsungAltonDiversified AwaySamsungAltonDiversified Away100%
-0.3
  Correlation Coefficient

Very good diversification

The 3 months correlation between Samsung and Alton is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Life and Alton Sports CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alton Sports CoLtd 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 Alton Sports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alton Sports CoLtd has no effect on the direction of Samsung Life i.e., Samsung Life and Alton Sports go up and down completely randomly.

Pair Corralation between Samsung Life and Alton Sports

Assuming the 90 days trading horizon Samsung Life is expected to generate 2.47 times more return on investment than Alton Sports. However, Samsung Life is 2.47 times more volatile than Alton Sports CoLtd. It trades about 0.22 of its potential returns per unit of risk. Alton Sports CoLtd is currently generating about -0.16 per unit of risk. If you would invest  8,810,000  in Samsung Life on November 21, 2024 and sell it today you would earn a total of  1,330,000  from holding Samsung Life or generate 15.1% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Samsung Life  vs.  Alton Sports CoLtd

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -15-10-50
JavaScript chart by amCharts 3.21.15032830 123750
       Timeline  
Samsung Life 

Risk-Adjusted Performance

Weak

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Samsung Life are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Samsung Life is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb85,00090,00095,000100,000105,000
Alton Sports CoLtd 

Risk-Adjusted Performance

Weak

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Alton Sports CoLtd are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Alton Sports is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb1,3001,4001,5001,6001,700

Samsung Life and Alton Sports Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-9.89-7.4-4.92-2.44-0.04142.424.937.439.9412.44 0.020.040.060.080.10
JavaScript chart by amCharts 3.21.15032830 123750
       Returns  

Pair Trading with Samsung Life and Alton Sports

The main advantage of trading using opposite Samsung Life and Alton Sports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Life position performs unexpectedly, Alton Sports 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 Alton Sports will offset losses from the drop in Alton Sports' long position.
The idea behind Samsung Life and Alton Sports CoLtd pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.

Other Complementary Tools

Portfolio Diagnostics
Use generated alerts and portfolio events aggregator to diagnose current holdings
Pair Correlation
Compare performance and examine fundamental relationship between any two equity instruments
Transaction History
View history of all your transactions and understand their impact on performance
Odds Of Bankruptcy
Get analysis of equity chance of financial distress in the next 2 years
Portfolio Analyzer
Portfolio analysis module that provides access to portfolio diagnostics and optimization engine