Correlation Between Total Soft and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both Total Soft 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 Total Soft and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Total Soft Bank and Samsung Electronics Co, you can compare the effects of market volatilities on Total Soft 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 Total Soft with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Total Soft and Samsung Electronics.
Diversification Opportunities for Total Soft and Samsung Electronics
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Total and Samsung is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding Total Soft Bank and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and Total Soft 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 Total Soft Bank 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 Total Soft i.e., Total Soft and Samsung Electronics go up and down completely randomly.
Pair Corralation between Total Soft and Samsung Electronics
Assuming the 90 days trading horizon Total Soft Bank is expected to generate 2.49 times more return on investment than Samsung Electronics. However, Total Soft is 2.49 times more volatile than Samsung Electronics Co. It trades about -0.03 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about -0.09 per unit of risk. If you would invest 518,000 in Total Soft Bank on August 31, 2024 and sell it today you would lose (47,000) from holding Total Soft Bank or give up 9.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Total Soft Bank vs. Samsung Electronics Co
Performance |
| Timeline |
| Total Soft Bank |
| Samsung Electronics |
Total Soft and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Total Soft and Samsung Electronics
The main advantage of trading using opposite Total Soft and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Total Soft 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.| Total Soft vs. Kakao Games Corp | Total Soft vs. Devsisters corporation | Total Soft vs. Konan Technology | Total Soft vs. Nice Information Telecommunication |
| 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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