Correlation Between Samji Electronics and NewFlex Technology
Can any of the company-specific risk be diversified away by investing in both Samji Electronics and NewFlex Technology 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 NewFlex Technology 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 NewFlex Technology Co, you can compare the effects of market volatilities on Samji Electronics and NewFlex Technology 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 NewFlex Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samji Electronics and NewFlex Technology.
Diversification Opportunities for Samji Electronics and NewFlex Technology
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Samji and NewFlex is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Samji Electronics Co and NewFlex Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NewFlex Technology 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 NewFlex Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NewFlex Technology has no effect on the direction of Samji Electronics i.e., Samji Electronics and NewFlex Technology go up and down completely randomly.
Pair Corralation between Samji Electronics and NewFlex Technology
Assuming the 90 days trading horizon Samji Electronics Co is expected to generate 0.36 times more return on investment than NewFlex Technology. However, Samji Electronics Co is 2.76 times less risky than NewFlex Technology. It trades about -0.05 of its potential returns per unit of risk. NewFlex Technology Co is currently generating about -0.25 per unit of risk. If you would invest 860,000 in Samji Electronics Co on August 29, 2024 and sell it today you would lose (8,000) from holding Samji Electronics Co or give up 0.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samji Electronics Co vs. NewFlex Technology Co
Performance |
| Timeline |
| Samji Electronics |
| NewFlex Technology |
Samji Electronics and NewFlex Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samji Electronics and NewFlex Technology
The main advantage of trading using opposite Samji Electronics and NewFlex Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samji Electronics position performs unexpectedly, NewFlex Technology 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 NewFlex Technology will offset losses from the drop in NewFlex Technology's long position.| Samji Electronics vs. SFA Semicon Co | Samji Electronics vs. Seronics Co | Samji Electronics vs. COWELL FASHION CoLtd | Samji Electronics vs. Seohee Construction Co |
| NewFlex Technology vs. Hanwha InvestmentSecurities Co | NewFlex Technology vs. SBI Investment KOREA | NewFlex Technology vs. Samyung Trading Co | NewFlex Technology vs. Korea Air Svc |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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