Correlation Between Silvercorp Metals and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both Silvercorp Metals 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 Silvercorp Metals and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Silvercorp Metals and Samsung Electronics Co, you can compare the effects of market volatilities on Silvercorp Metals 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 Silvercorp Metals with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Silvercorp Metals and Samsung Electronics.
Diversification Opportunities for Silvercorp Metals and Samsung Electronics
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Silvercorp and Samsung is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Silvercorp Metals and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and Silvercorp Metals 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 Silvercorp Metals 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 Silvercorp Metals i.e., Silvercorp Metals and Samsung Electronics go up and down completely randomly.
Pair Corralation between Silvercorp Metals and Samsung Electronics
Assuming the 90 days trading horizon Silvercorp Metals is expected to generate 1.94 times more return on investment than Samsung Electronics. However, Silvercorp Metals is 1.94 times more volatile than Samsung Electronics Co. It trades about 0.02 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about -0.02 per unit of risk. If you would invest 451.00 in Silvercorp Metals on August 31, 2024 and sell it today you would earn a total of 5.00 from holding Silvercorp Metals or generate 1.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 86.69% |
| Values | Daily Returns |
Silvercorp Metals vs. Samsung Electronics Co
Performance |
| Timeline |
| Silvercorp Metals |
| Samsung Electronics |
Silvercorp Metals and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Silvercorp Metals and Samsung Electronics
The main advantage of trading using opposite Silvercorp Metals and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Silvercorp Metals 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.| Silvercorp Metals vs. Neometals | Silvercorp Metals vs. Coor Service Management | Silvercorp Metals vs. Aeorema Communications Plc | Silvercorp Metals vs. JLEN Environmental Assets |
| Samsung Electronics vs. Kaufman Et Broad | Samsung Electronics vs. Allianz Technology Trust | Samsung Electronics vs. Monster Beverage Corp | Samsung Electronics vs. Gaztransport et Technigaz |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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