Correlation Between Korea Aerospace and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both Korea Aerospace 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 Korea Aerospace and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Korea Aerospace Industries and Samsung Electronics Co, you can compare the effects of market volatilities on Korea Aerospace 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 Korea Aerospace with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Korea Aerospace and Samsung Electronics.
Diversification Opportunities for Korea Aerospace and Samsung Electronics
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Korea and Samsung is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Korea Aerospace Industries and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and Korea Aerospace 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 Korea Aerospace Industries 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 Korea Aerospace i.e., Korea Aerospace and Samsung Electronics go up and down completely randomly.
Pair Corralation between Korea Aerospace and Samsung Electronics
Assuming the 90 days trading horizon Korea Aerospace Industries is expected to generate 1.18 times more return on investment than Samsung Electronics. However, Korea Aerospace is 1.18 times more volatile than Samsung Electronics Co. It trades about 0.11 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about 0.02 per unit of risk. If you would invest 5,540,000 in Korea Aerospace Industries on August 29, 2024 and sell it today you would earn a total of 390,000 from holding Korea Aerospace Industries or generate 7.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Korea Aerospace Industries vs. Samsung Electronics Co
Performance |
| Timeline |
| Korea Aerospace Indu |
| Samsung Electronics |
Korea Aerospace and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Korea Aerospace and Samsung Electronics
The main advantage of trading using opposite Korea Aerospace and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Korea Aerospace 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.| Korea Aerospace vs. Samsung Electronics Co | Korea Aerospace vs. Samsung Electronics Co | Korea Aerospace vs. KB Financial Group | Korea Aerospace vs. Shinhan Financial Group |
| Samsung Electronics vs. Chin Yang Chemical | Samsung Electronics vs. Dongbang Transport Logistics | Samsung Electronics vs. Shinhan Inverse Silver | Samsung Electronics vs. JC Chemical Co |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |