Correlation Between Samsung Publishing and ECSTELECOM
Can any of the company-specific risk be diversified away by investing in both Samsung Publishing and ECSTELECOM 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 ECSTELECOM 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 ECSTELECOM Co, you can compare the effects of market volatilities on Samsung Publishing and ECSTELECOM 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 ECSTELECOM. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Publishing and ECSTELECOM.
Diversification Opportunities for Samsung Publishing and ECSTELECOM
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Samsung and ECSTELECOM is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Publishing Co and ECSTELECOM Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ECSTELECOM 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 ECSTELECOM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ECSTELECOM has no effect on the direction of Samsung Publishing i.e., Samsung Publishing and ECSTELECOM go up and down completely randomly.
Pair Corralation between Samsung Publishing and ECSTELECOM
Assuming the 90 days trading horizon Samsung Publishing Co is expected to generate 2.41 times more return on investment than ECSTELECOM. However, Samsung Publishing is 2.41 times more volatile than ECSTELECOM Co. It trades about 0.01 of its potential returns per unit of risk. ECSTELECOM Co is currently generating about 0.02 per unit of risk. If you would invest 1,677,588 in Samsung Publishing Co on October 16, 2024 and sell it today you would lose (135,588) from holding Samsung Publishing Co or give up 8.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Publishing Co vs. ECSTELECOM Co
Performance |
| Timeline |
| Samsung Publishing |
| ECSTELECOM |
Samsung Publishing and ECSTELECOM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Publishing and ECSTELECOM
The main advantage of trading using opposite Samsung Publishing and ECSTELECOM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Publishing position performs unexpectedly, ECSTELECOM 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 ECSTELECOM will offset losses from the drop in ECSTELECOM's long position.| Samsung Publishing vs. Kolon Plastics | Samsung Publishing vs. LAKE MATERIALS LTD | Samsung Publishing vs. Taegu Broadcasting | Samsung Publishing vs. Jeju Beer Co |
| ECSTELECOM vs. Keyang Electric Machinery | ECSTELECOM vs. Samsung Publishing Co | ECSTELECOM vs. Shinsegae Engineering Construction | ECSTELECOM vs. INSUN Environmental New |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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