Correlation Between Samji Electronics and KT
Can any of the company-specific risk be diversified away by investing in both Samji Electronics and KT 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 Samji Electronics and KT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samji Electronics Co and KT Corporation, you can compare the effects of market volatilities on Samji Electronics and KT 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 Samji Electronics with a short position of KT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samji Electronics and KT.
Diversification Opportunities for Samji Electronics and KT
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Samji and KT is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Samji Electronics Co and KT Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KT Corporation and Samji Electronics 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 Samji Electronics Co are associated (or correlated) with KT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KT Corporation has no effect on the direction of Samji Electronics i.e., Samji Electronics and KT go up and down completely randomly.
Pair Corralation between Samji Electronics and KT
Assuming the 90 days trading horizon Samji Electronics Co is expected to under-perform the KT. But the stock apears to be less risky and, when comparing its historical volatility, Samji Electronics Co is 1.68 times less risky than KT. The stock trades about -0.07 of its potential returns per unit of risk. The KT Corporation is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 4,350,000 in KT Corporation on September 13, 2024 and sell it today you would earn a total of 110,000 from holding KT Corporation or generate 2.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samji Electronics Co vs. KT Corp.
Performance |
| Timeline |
| Samji Electronics |
| KT Corporation |
Samji Electronics and KT Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samji Electronics and KT
The main advantage of trading using opposite Samji Electronics and KT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samji Electronics position performs unexpectedly, KT 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 KT will offset losses from the drop in KT's long position.| Samji Electronics vs. Cube Entertainment | Samji Electronics vs. Dreamus Company | Samji Electronics vs. LG Energy Solution | Samji Electronics vs. Dongwon System |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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