Correlation Between Samsung Publishing and Seoul Food
Can any of the company-specific risk be diversified away by investing in both Samsung Publishing and Seoul Food 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 Samsung Publishing and Seoul Food into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samsung Publishing Co and Seoul Food Industrial, you can compare the effects of market volatilities on Samsung Publishing and Seoul Food 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 Samsung Publishing with a short position of Seoul Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Publishing and Seoul Food.
Diversification Opportunities for Samsung Publishing and Seoul Food
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Samsung and Seoul is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Publishing Co and Seoul Food Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seoul Food Industrial and Samsung Publishing 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 Samsung Publishing Co are associated (or correlated) with Seoul Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seoul Food Industrial has no effect on the direction of Samsung Publishing i.e., Samsung Publishing and Seoul Food go up and down completely randomly.
Pair Corralation between Samsung Publishing and Seoul Food
Assuming the 90 days trading horizon Samsung Publishing Co is expected to generate 2.45 times more return on investment than Seoul Food. However, Samsung Publishing is 2.45 times more volatile than Seoul Food Industrial. It trades about -0.01 of its potential returns per unit of risk. Seoul Food Industrial is currently generating about -0.04 per unit of risk. If you would invest 2,432,845 in Samsung Publishing Co on October 15, 2024 and sell it today you would lose (916,845) from holding Samsung Publishing Co or give up 37.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Publishing Co vs. Seoul Food Industrial
Performance |
| Timeline |
| Samsung Publishing |
| Seoul Food Industrial |
Samsung Publishing and Seoul Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Publishing and Seoul Food
The main advantage of trading using opposite Samsung Publishing and Seoul Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Publishing position performs unexpectedly, Seoul Food 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 Seoul Food will offset losses from the drop in Seoul Food's long position.| Samsung Publishing vs. Hanshin Construction Co | Samsung Publishing vs. Nam Hwa Construction | Samsung Publishing vs. PLAYWITH | Samsung Publishing vs. Display Tech Co |
| Seoul Food vs. Seoul Electronics Telecom | Seoul Food vs. Jeju Air Co | Seoul Food vs. KT Submarine Telecom | Seoul Food vs. Shinhan Inverse Silver |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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