Correlation Between Samsung Life and Maeil Dairies
Can any of the company-specific risk be diversified away by investing in both Samsung Life and Maeil Dairies 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 Maeil Dairies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samsung Life and Maeil Dairies Co, you can compare the effects of market volatilities on Samsung Life and Maeil Dairies 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 Maeil Dairies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Life and Maeil Dairies.
Diversification Opportunities for Samsung Life and Maeil Dairies
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Samsung and Maeil is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Life and Maeil Dairies Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maeil Dairies 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 Maeil Dairies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Maeil Dairies has no effect on the direction of Samsung Life i.e., Samsung Life and Maeil Dairies go up and down completely randomly.
Pair Corralation between Samsung Life and Maeil Dairies
Assuming the 90 days trading horizon Samsung Life is expected to generate 3.27 times more return on investment than Maeil Dairies. However, Samsung Life is 3.27 times more volatile than Maeil Dairies Co. It trades about 0.04 of its potential returns per unit of risk. Maeil Dairies Co is currently generating about -0.04 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 | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Life vs. Maeil Dairies Co
Performance |
| Timeline |
| Samsung Life |
| Maeil Dairies |
Samsung Life and Maeil Dairies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Life and Maeil Dairies
The main advantage of trading using opposite Samsung Life and Maeil Dairies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Life position performs unexpectedly, Maeil Dairies 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 Maeil Dairies will offset losses from the drop in Maeil Dairies' long position.| Samsung Life vs. Wireless Power Amplifier | Samsung Life vs. LB Investment | Samsung Life vs. LG Chemicals | Samsung Life vs. Korea Investment Holdings |
| Maeil Dairies vs. Dongwoo Farm To | Maeil Dairies vs. Wing Yip Food | Maeil Dairies vs. Busan Industrial Co | Maeil Dairies 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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