Correlation Between Samsung Life and RS Automation
Can any of the company-specific risk be diversified away by investing in both Samsung Life and RS Automation 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 RS Automation into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samsung Life and RS Automation CoLtd, you can compare the effects of market volatilities on Samsung Life and RS Automation 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 RS Automation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Life and RS Automation.
Diversification Opportunities for Samsung Life and RS Automation
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Samsung and 140670 is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Life and RS Automation CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RS Automation 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 RS Automation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RS Automation CoLtd has no effect on the direction of Samsung Life i.e., Samsung Life and RS Automation go up and down completely randomly.
Pair Corralation between Samsung Life and RS Automation
Assuming the 90 days trading horizon Samsung Life is expected to under-perform the RS Automation. But the stock apears to be less risky and, when comparing its historical volatility, Samsung Life is 4.85 times less risky than RS Automation. The stock trades about -0.4 of its potential returns per unit of risk. The RS Automation CoLtd is currently generating about 0.27 of returns per unit of risk over similar time horizon. If you would invest 1,056,000 in RS Automation CoLtd on October 22, 2024 and sell it today you would earn a total of 428,000 from holding RS Automation CoLtd or generate 40.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Life vs. RS Automation CoLtd
Performance |
| Timeline |
| Samsung Life |
| RS Automation CoLtd |
Samsung Life and RS Automation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Life and RS Automation
The main advantage of trading using opposite Samsung Life and RS Automation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Life position performs unexpectedly, RS Automation 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 RS Automation will offset losses from the drop in RS Automation's long position.| Samsung Life vs. A Tech Solution Co | Samsung Life vs. BIT Computer Co | Samsung Life vs. Lotte Data Communication | Samsung Life vs. PH Tech Co |
| RS Automation vs. Daejung Chemicals Metals | RS Automation vs. Kukdong Oil Chemicals | RS Automation vs. Jeju Beer Co | RS Automation vs. Hyundai Home Shopping |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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