Correlation Between Kaonmedia and Samsung Card
Can any of the company-specific risk be diversified away by investing in both Kaonmedia and Samsung Card 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 Kaonmedia and Samsung Card into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kaonmedia Co and Samsung Card Co, you can compare the effects of market volatilities on Kaonmedia and Samsung Card 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 Kaonmedia with a short position of Samsung Card. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kaonmedia and Samsung Card.
Diversification Opportunities for Kaonmedia and Samsung Card
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Kaonmedia and Samsung is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Kaonmedia Co and Samsung Card Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Card and Kaonmedia 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 Kaonmedia Co are associated (or correlated) with Samsung Card. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samsung Card has no effect on the direction of Kaonmedia i.e., Kaonmedia and Samsung Card go up and down completely randomly.
Pair Corralation between Kaonmedia and Samsung Card
Assuming the 90 days trading horizon Kaonmedia Co is expected to under-perform the Samsung Card. In addition to that, Kaonmedia is 1.09 times more volatile than Samsung Card Co. It trades about -0.18 of its total potential returns per unit of risk. Samsung Card Co is currently generating about 0.33 per unit of volatility. If you would invest 3,910,000 in Samsung Card Co on November 3, 2024 and sell it today you would earn a total of 290,000 from holding Samsung Card Co or generate 7.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kaonmedia Co vs. Samsung Card Co
Performance |
| Timeline |
| Kaonmedia |
| Samsung Card |
Kaonmedia and Samsung Card Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kaonmedia and Samsung Card
The main advantage of trading using opposite Kaonmedia and Samsung Card positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kaonmedia position performs unexpectedly, Samsung Card 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 Card will offset losses from the drop in Samsung Card's long position.| Kaonmedia vs. Samsung Electronics Co | Kaonmedia vs. Samsung Electronics Co | Kaonmedia vs. Hyundai Motor Co | Kaonmedia vs. Hyundai Motor |
| Samsung Card vs. GS Engineering Construction | Samsung Card vs. Korea Computer | Samsung Card vs. Nam Hwa Construction | Samsung Card vs. Daishin Information Communications |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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