Correlation Between I-Components and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both I-Components 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 I-Components and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between i Components Co and Samsung Electronics Co, you can compare the effects of market volatilities on I-Components 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 I-Components with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of I-Components and Samsung Electronics.
Diversification Opportunities for I-Components and Samsung Electronics
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between I-Components and Samsung is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding i Components Co and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and I-Components 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 i Components Co 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 I-Components i.e., I-Components and Samsung Electronics go up and down completely randomly.
Pair Corralation between I-Components and Samsung Electronics
Assuming the 90 days trading horizon i Components Co is expected to generate 0.41 times more return on investment than Samsung Electronics. However, i Components Co is 2.41 times less risky than Samsung Electronics. It trades about 0.15 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about -0.16 per unit of risk. If you would invest 460,000 in i Components Co on September 26, 2024 and sell it today you would earn a total of 10,500 from holding i Components Co or generate 2.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
i Components Co vs. Samsung Electronics Co
Performance |
| Timeline |
| i Components |
| Samsung Electronics |
I-Components and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with I-Components and Samsung Electronics
The main advantage of trading using opposite I-Components and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if I-Components 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.| I-Components vs. Samsung Electronics Co | I-Components vs. Samsung Electronics Co | I-Components vs. LG Energy Solution | I-Components vs. SK Hynix |
| 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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