Correlation Between Samsung Life and Polaris Office
Can any of the company-specific risk be diversified away by investing in both Samsung Life and Polaris Office 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 Polaris Office into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samsung Life Insurance and Polaris Office Corp, you can compare the effects of market volatilities on Samsung Life and Polaris Office 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 Polaris Office. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Life and Polaris Office.
Diversification Opportunities for Samsung Life and Polaris Office
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Samsung and Polaris is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Life Insurance and Polaris Office Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Polaris Office Corp 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 Insurance are associated (or correlated) with Polaris Office. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Polaris Office Corp has no effect on the direction of Samsung Life i.e., Samsung Life and Polaris Office go up and down completely randomly.
Pair Corralation between Samsung Life and Polaris Office
Assuming the 90 days trading horizon Samsung Life is expected to generate 5.62 times less return on investment than Polaris Office. But when comparing it to its historical volatility, Samsung Life Insurance is 1.44 times less risky than Polaris Office. It trades about 0.04 of its potential returns per unit of risk. Polaris Office Corp is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 506,000 in Polaris Office Corp on August 28, 2024 and sell it today you would earn a total of 79,000 from holding Polaris Office Corp or generate 15.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Life Insurance vs. Polaris Office Corp
Performance |
| Timeline |
| Samsung Life Insurance |
| Polaris Office Corp |
Samsung Life and Polaris Office Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Life and Polaris Office
The main advantage of trading using opposite Samsung Life and Polaris Office positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Life position performs unexpectedly, Polaris Office 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 Polaris Office will offset losses from the drop in Polaris Office's long position.| Samsung Life vs. AptaBio Therapeutics | Samsung Life vs. Daewoo SBI SPAC | Samsung Life vs. Dream Security co | Samsung Life vs. Microfriend |
| Polaris Office vs. Korea Real Estate | Polaris Office vs. Korea Ratings Co | Polaris Office vs. IQuest Co | Polaris Office vs. Wonbang Tech 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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