Correlation Between Samsung Publishing and InnoTherapy
Can any of the company-specific risk be diversified away by investing in both Samsung Publishing and InnoTherapy 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 InnoTherapy 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 InnoTherapy, you can compare the effects of market volatilities on Samsung Publishing and InnoTherapy 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 InnoTherapy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Publishing and InnoTherapy.
Diversification Opportunities for Samsung Publishing and InnoTherapy
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Samsung and InnoTherapy is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Publishing Co and InnoTherapy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on InnoTherapy 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 InnoTherapy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of InnoTherapy has no effect on the direction of Samsung Publishing i.e., Samsung Publishing and InnoTherapy go up and down completely randomly.
Pair Corralation between Samsung Publishing and InnoTherapy
Assuming the 90 days trading horizon Samsung Publishing is expected to generate 6.84 times less return on investment than InnoTherapy. But when comparing it to its historical volatility, Samsung Publishing Co is 1.14 times less risky than InnoTherapy. It trades about 0.07 of its potential returns per unit of risk. InnoTherapy is currently generating about 0.44 of returns per unit of risk over similar time horizon. If you would invest 824,000 in InnoTherapy on October 30, 2024 and sell it today you would earn a total of 149,000 from holding InnoTherapy or generate 18.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Publishing Co vs. InnoTherapy
Performance |
| Timeline |
| Samsung Publishing |
| InnoTherapy |
Samsung Publishing and InnoTherapy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Publishing and InnoTherapy
The main advantage of trading using opposite Samsung Publishing and InnoTherapy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Publishing position performs unexpectedly, InnoTherapy 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 InnoTherapy will offset losses from the drop in InnoTherapy's long position.| Samsung Publishing vs. PJ Metal Co | Samsung Publishing vs. Hanjoo Light Metal | Samsung Publishing vs. Nable Communications | Samsung Publishing vs. Seoyon Topmetal Co |
| InnoTherapy vs. GS Retail Co | InnoTherapy vs. Samlip General Foods | InnoTherapy vs. InfoBank | InnoTherapy vs. Seoul Food Industrial |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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