Correlation Between Samsung Life and Asia Seed
Can any of the company-specific risk be diversified away by investing in both Samsung Life and Asia Seed 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 Asia Seed into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samsung Life and Asia Seed CoLtd, you can compare the effects of market volatilities on Samsung Life and Asia Seed 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 Asia Seed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Life and Asia Seed.
Diversification Opportunities for Samsung Life and Asia Seed
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Samsung and Asia is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Life and Asia Seed CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Asia Seed 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 Asia Seed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Asia Seed CoLtd has no effect on the direction of Samsung Life i.e., Samsung Life and Asia Seed go up and down completely randomly.
Pair Corralation between Samsung Life and Asia Seed
Assuming the 90 days trading horizon Samsung Life is expected to generate 1.63 times more return on investment than Asia Seed. However, Samsung Life is 1.63 times more volatile than Asia Seed CoLtd. It trades about 0.08 of its potential returns per unit of risk. Asia Seed CoLtd is currently generating about -0.07 per unit of risk. If you would invest 6,940,000 in Samsung Life on August 25, 2024 and sell it today you would earn a total of 3,710,000 from holding Samsung Life or generate 53.46% 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. Asia Seed CoLtd
Performance |
| Timeline |
| Samsung Life |
| Asia Seed CoLtd |
Samsung Life and Asia Seed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Life and Asia Seed
The main advantage of trading using opposite Samsung Life and Asia Seed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Life position performs unexpectedly, Asia Seed 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 Asia Seed will offset losses from the drop in Asia Seed's long position.| Samsung Life vs. Korea New Network | Samsung Life vs. Dong A Eltek | Samsung Life vs. Dreamus Company | Samsung Life vs. SK Bioscience Co |
| Asia Seed vs. Maeil Dairies Co | Asia Seed vs. HYUNDAI FEED | Asia Seed vs. Dongwoo Farm To | Asia Seed vs. Wooyang 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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