Correlation Between Markel Corp and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both Markel Corp 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 Markel Corp and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Markel Corp and Samsung Electronics Co, you can compare the effects of market volatilities on Markel Corp 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 Markel Corp with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Markel Corp and Samsung Electronics.
Diversification Opportunities for Markel Corp and Samsung Electronics
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Markel and Samsung is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Markel Corp and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and Markel Corp 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 Markel Corp 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 Markel Corp i.e., Markel Corp and Samsung Electronics go up and down completely randomly.
Pair Corralation between Markel Corp and Samsung Electronics
Assuming the 90 days trading horizon Markel Corp is expected to generate 0.39 times more return on investment than Samsung Electronics. However, Markel Corp is 2.56 times less risky than Samsung Electronics. It trades about 0.2 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about 0.03 per unit of risk. If you would invest 165,500 in Markel Corp on September 13, 2024 and sell it today you would earn a total of 9,235 from holding Markel Corp or generate 5.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Markel Corp vs. Samsung Electronics Co
Performance |
| Timeline |
| Markel Corp |
| Samsung Electronics |
Markel Corp and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Markel Corp and Samsung Electronics
The main advantage of trading using opposite Markel Corp and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Markel Corp 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.| Markel Corp vs. Samsung Electronics Co | Markel Corp vs. Samsung Electronics Co | Markel Corp vs. Hyundai Motor | Markel Corp vs. Reliance Industries Ltd |
| Samsung Electronics vs. Fidelity National Information | Samsung Electronics vs. Edita Food Industries | Samsung Electronics vs. Axfood AB | Samsung Electronics vs. Air Products Chemicals |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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