Correlation Between Flow Traders and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both Flow Traders 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 Flow Traders and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Flow Traders NV and Samsung Electronics Co, you can compare the effects of market volatilities on Flow Traders 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 Flow Traders with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Flow Traders and Samsung Electronics.
Diversification Opportunities for Flow Traders and Samsung Electronics
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Flow and Samsung is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding Flow Traders NV and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and Flow Traders 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 Flow Traders NV 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 Flow Traders i.e., Flow Traders and Samsung Electronics go up and down completely randomly.
Pair Corralation between Flow Traders and Samsung Electronics
Assuming the 90 days trading horizon Flow Traders NV is expected to generate 0.49 times more return on investment than Samsung Electronics. However, Flow Traders NV is 2.05 times less risky than Samsung Electronics. It trades about 0.06 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about -0.1 per unit of risk. If you would invest 2,057 in Flow Traders NV on September 4, 2024 and sell it today you would earn a total of 37.00 from holding Flow Traders NV or generate 1.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Flow Traders NV vs. Samsung Electronics Co
Performance |
| Timeline |
| Flow Traders NV |
| Samsung Electronics |
Flow Traders and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Flow Traders and Samsung Electronics
The main advantage of trading using opposite Flow Traders and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Flow Traders 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.| Flow Traders vs. Samsung Electronics Co | Flow Traders vs. Samsung Electronics Co | Flow Traders vs. Hyundai Motor | Flow Traders vs. Toyota Motor Corp |
| Samsung Electronics vs. MTI Wireless Edge | Samsung Electronics vs. Ecclesiastical Insurance Office | Samsung Electronics vs. Pets at Home | Samsung Electronics vs. Norwegian Air Shuttle |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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