Correlation Between Argen X and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both Argen X 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 Argen X and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Argen X and Samsung Electronics Co, you can compare the effects of market volatilities on Argen X 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 Argen X with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Argen X and Samsung Electronics.
Diversification Opportunities for Argen X and Samsung Electronics
-0.9 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Argen and Samsung is -0.9. Overlapping area represents the amount of risk that can be diversified away by holding Argen X and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and Argen X 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 Argen X 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 Argen X i.e., Argen X and Samsung Electronics go up and down completely randomly.
Pair Corralation between Argen X and Samsung Electronics
Assuming the 90 days trading horizon Argen X is expected to generate 0.81 times more return on investment than Samsung Electronics. However, Argen X is 1.24 times less risky than Samsung Electronics. It trades about 0.3 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about -0.13 per unit of risk. If you would invest 53,623 in Argen X on September 20, 2024 and sell it today you would earn a total of 6,457 from holding Argen X or generate 12.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Argen X vs. Samsung Electronics Co
Performance |
| Timeline |
| Argen X |
| Samsung Electronics |
Argen X and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Argen X and Samsung Electronics
The main advantage of trading using opposite Argen X and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Argen X 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.| Argen X vs. Samsung Electronics Co | Argen X vs. Samsung Electronics Co | Argen X vs. Hyundai Motor | Argen X vs. Reliance Industries Ltd |
| Samsung Electronics vs. Endeavour Mining Corp | Samsung Electronics vs. CNH Industrial NV | Samsung Electronics vs. Neometals | Samsung Electronics vs. GoldMining |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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