Correlation Between Samsung Life and Shin Steel
Can any of the company-specific risk be diversified away by investing in both Samsung Life and Shin Steel 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 Shin Steel 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 Shin Steel Co, you can compare the effects of market volatilities on Samsung Life and Shin Steel 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 Shin Steel. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Life and Shin Steel.
Diversification Opportunities for Samsung Life and Shin Steel
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Samsung and Shin is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Life Insurance and Shin Steel Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shin Steel 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 Shin Steel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shin Steel has no effect on the direction of Samsung Life i.e., Samsung Life and Shin Steel go up and down completely randomly.
Pair Corralation between Samsung Life and Shin Steel
Assuming the 90 days trading horizon Samsung Life Insurance is expected to under-perform the Shin Steel. But the stock apears to be less risky and, when comparing its historical volatility, Samsung Life Insurance is 1.19 times less risky than Shin Steel. The stock trades about -0.09 of its potential returns per unit of risk. The Shin Steel Co is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 245,500 in Shin Steel Co on October 24, 2024 and sell it today you would lose (1,000.00) from holding Shin Steel Co or give up 0.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Life Insurance vs. Shin Steel Co
Performance |
| Timeline |
| Samsung Life Insurance |
| Shin Steel |
Samsung Life and Shin Steel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Life and Shin Steel
The main advantage of trading using opposite Samsung Life and Shin Steel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Life position performs unexpectedly, Shin Steel 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 Shin Steel will offset losses from the drop in Shin Steel's long position.| Samsung Life vs. ENF Technology Co | Samsung Life vs. Sajo Seafood | Samsung Life vs. Foodnamoo | Samsung Life vs. Sam Yang Foods |
| Shin Steel vs. CKH Food Health | Shin Steel vs. Samsung Life Insurance | Shin Steel vs. Mobile Appliance | Shin Steel vs. Nice Information Telecommunication |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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