Correlation Between Finnair Oyj and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both Finnair Oyj and Samsung Electronics 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 Finnair Oyj and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Finnair Oyj and Samsung Electronics Co, you can compare the effects of market volatilities on Finnair Oyj and Samsung Electronics 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 Finnair Oyj with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Finnair Oyj and Samsung Electronics.
Diversification Opportunities for Finnair Oyj and Samsung Electronics
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Finnair and Samsung is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Finnair Oyj and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and Finnair Oyj 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 Finnair Oyj are associated (or correlated) with Samsung Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samsung Electronics has no effect on the direction of Finnair Oyj i.e., Finnair Oyj and Samsung Electronics go up and down completely randomly.
Pair Corralation between Finnair Oyj and Samsung Electronics
Assuming the 90 days trading horizon Finnair Oyj is expected to under-perform the Samsung Electronics. In addition to that, Finnair Oyj is 1.99 times more volatile than Samsung Electronics Co. It trades about -0.04 of its total potential returns per unit of risk. Samsung Electronics Co is currently generating about 0.0 per unit of volatility. If you would invest 107,215 in Samsung Electronics Co on September 14, 2024 and sell it today you would lose (10,065) from holding Samsung Electronics Co or give up 9.39% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Finnair Oyj vs. Samsung Electronics Co
Performance |
| Timeline |
| Finnair Oyj |
| Samsung Electronics |
Finnair Oyj and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Finnair Oyj and Samsung Electronics
The main advantage of trading using opposite Finnair Oyj and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Finnair Oyj position performs unexpectedly, Samsung Electronics 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 Electronics will offset losses from the drop in Samsung Electronics' long position.| Finnair Oyj vs. Eastman Chemical Co | Finnair Oyj vs. Gruppo MutuiOnline SpA | Finnair Oyj vs. Westlake Chemical Corp | Finnair Oyj vs. Gamma Communications PLC |
| Samsung Electronics vs. European Metals Holdings | Samsung Electronics vs. Axfood AB | Samsung Electronics vs. McEwen Mining | Samsung Electronics vs. Roebuck Food Group |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |