Correlation Between Medical Properties and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both Medical Properties 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 Medical Properties and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Medical Properties Trust and Samsung Electronics Co, you can compare the effects of market volatilities on Medical Properties 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 Medical Properties with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Medical Properties and Samsung Electronics.
Diversification Opportunities for Medical Properties and Samsung Electronics
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Medical and Samsung is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Medical Properties Trust and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and Medical Properties 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 Medical Properties Trust 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 Medical Properties i.e., Medical Properties and Samsung Electronics go up and down completely randomly.
Pair Corralation between Medical Properties and Samsung Electronics
Assuming the 90 days trading horizon Medical Properties Trust is expected to generate 1.53 times more return on investment than Samsung Electronics. However, Medical Properties is 1.53 times more volatile than Samsung Electronics Co. It trades about -0.04 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about -0.18 per unit of risk. If you would invest 472.00 in Medical Properties Trust on September 21, 2024 and sell it today you would lose (90.00) from holding Medical Properties Trust or give up 19.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Medical Properties Trust vs. Samsung Electronics Co
Performance |
| Timeline |
| Medical Properties Trust |
| Samsung Electronics |
Medical Properties and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Medical Properties and Samsung Electronics
The main advantage of trading using opposite Medical Properties and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Medical Properties 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.| Medical Properties vs. Samsung Electronics Co | Medical Properties vs. Samsung Electronics Co | Medical Properties vs. Hyundai Motor | Medical Properties vs. Reliance Industries Ltd |
| Samsung Electronics vs. Hollywood Bowl Group | Samsung Electronics vs. JD Sports Fashion | Samsung Electronics vs. Prosiebensat 1 Media | Samsung Electronics vs. Catalyst Media 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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