Correlation Between FNSTech and Samsung Life
Can any of the company-specific risk be diversified away by investing in both FNSTech and Samsung Life 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 FNSTech and Samsung Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FNSTech Co and Samsung Life Insurance, you can compare the effects of market volatilities on FNSTech and Samsung Life 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 FNSTech with a short position of Samsung Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of FNSTech and Samsung Life.
Diversification Opportunities for FNSTech and Samsung Life
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between FNSTech and Samsung is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding FNSTech Co and Samsung Life Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Life Insurance and FNSTech 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 FNSTech Co are associated (or correlated) with Samsung Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samsung Life Insurance has no effect on the direction of FNSTech i.e., FNSTech and Samsung Life go up and down completely randomly.
Pair Corralation between FNSTech and Samsung Life
Assuming the 90 days trading horizon FNSTech is expected to generate 1.4 times less return on investment than Samsung Life. In addition to that, FNSTech is 1.63 times more volatile than Samsung Life Insurance. It trades about 0.02 of its total potential returns per unit of risk. Samsung Life Insurance is currently generating about 0.05 per unit of volatility. If you would invest 6,801,446 in Samsung Life Insurance on September 2, 2024 and sell it today you would earn a total of 3,908,554 from holding Samsung Life Insurance or generate 57.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
FNSTech Co vs. Samsung Life Insurance
Performance |
| Timeline |
| FNSTech |
| Samsung Life Insurance |
FNSTech and Samsung Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FNSTech and Samsung Life
The main advantage of trading using opposite FNSTech and Samsung Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FNSTech position performs unexpectedly, Samsung Life 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 Life will offset losses from the drop in Samsung Life's long position.| FNSTech vs. Samsung Electronics Co | FNSTech vs. Samsung Electronics Co | FNSTech vs. LG Energy Solution | FNSTech vs. SK Hynix |
| Samsung Life vs. AptaBio Therapeutics | Samsung Life vs. Daewoo SBI SPAC | Samsung Life vs. Dream Security co | Samsung Life vs. Microfriend |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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