Correlation Between Taewoong CoLtd and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both Taewoong CoLtd and Samsung Electronics 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 Taewoong CoLtd and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Taewoong CoLtd and Samsung Electronics Co, you can compare the effects of market volatilities on Taewoong CoLtd and Samsung Electronics 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 Taewoong CoLtd with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Taewoong CoLtd and Samsung Electronics.
Diversification Opportunities for Taewoong CoLtd and Samsung Electronics
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Taewoong and Samsung is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Taewoong CoLtd and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and Taewoong CoLtd 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 Taewoong CoLtd are associated (or correlated) with Samsung Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samsung Electronics has no effect on the direction of Taewoong CoLtd i.e., Taewoong CoLtd and Samsung Electronics go up and down completely randomly.
Pair Corralation between Taewoong CoLtd and Samsung Electronics
Assuming the 90 days trading horizon Taewoong CoLtd is expected to generate 2.01 times more return on investment than Samsung Electronics. However, Taewoong CoLtd is 2.01 times more volatile than Samsung Electronics Co. It trades about 0.02 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about 0.0 per unit of risk. If you would invest 929,000 in Taewoong CoLtd on September 4, 2024 and sell it today you would earn a total of 83,000 from holding Taewoong CoLtd or generate 8.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Taewoong CoLtd vs. Samsung Electronics Co
Performance |
| Timeline |
| Taewoong CoLtd |
| Samsung Electronics |
Taewoong CoLtd and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Taewoong CoLtd and Samsung Electronics
The main advantage of trading using opposite Taewoong CoLtd and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Taewoong CoLtd position performs unexpectedly, Samsung Electronics 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 Samsung Electronics will offset losses from the drop in Samsung Electronics' long position.| Taewoong CoLtd vs. Tae Kwang | Taewoong CoLtd vs. Seoul Semiconductor Co | Taewoong CoLtd vs. Soulbrain Holdings Co |
| Samsung Electronics vs. Dongsin Engineering Construction | Samsung Electronics vs. Doosan Fuel Cell | Samsung Electronics vs. Daishin Balance 1 | Samsung Electronics vs. Total Soft Bank |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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