Correlation Between Bell Food and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both Bell Food 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 Bell Food and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bell Food Group and Samsung Electronics Co, you can compare the effects of market volatilities on Bell Food 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 Bell Food with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bell Food and Samsung Electronics.
Diversification Opportunities for Bell Food and Samsung Electronics
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Bell and Samsung is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Bell Food Group and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and Bell Food 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 Bell Food Group 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 Bell Food i.e., Bell Food and Samsung Electronics go up and down completely randomly.
Pair Corralation between Bell Food and Samsung Electronics
Assuming the 90 days trading horizon Bell Food Group is expected to generate 0.25 times more return on investment than Samsung Electronics. However, Bell Food Group is 3.94 times less risky than Samsung Electronics. It trades about 0.01 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 26,500 in Bell Food Group on August 28, 2024 and sell it today you would earn a total of 100.00 from holding Bell Food Group or generate 0.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bell Food Group vs. Samsung Electronics Co
Performance |
| Timeline |
| Bell Food Group |
| Samsung Electronics |
Bell Food and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bell Food and Samsung Electronics
The main advantage of trading using opposite Bell Food and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bell Food 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.| Bell Food vs. Samsung Electronics Co | Bell Food vs. Samsung Electronics Co | Bell Food vs. Hyundai Motor | Bell Food vs. Toyota Motor Corp |
| Samsung Electronics vs. Toyota Motor Corp | Samsung Electronics vs. SoftBank Group Corp | Samsung Electronics vs. OTP Bank Nyrt | Samsung Electronics vs. Las Vegas Sands |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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