Correlation Between People Technology and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both People Technology 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 People Technology and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between People Technology and Samsung Electronics Co, you can compare the effects of market volatilities on People Technology 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 People Technology with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of People Technology and Samsung Electronics.
Diversification Opportunities for People Technology and Samsung Electronics
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between People and Samsung is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding People Technology and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and People Technology 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 People Technology 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 People Technology i.e., People Technology and Samsung Electronics go up and down completely randomly.
Pair Corralation between People Technology and Samsung Electronics
Assuming the 90 days trading horizon People Technology is expected to under-perform the Samsung Electronics. In addition to that, People Technology is 1.4 times more volatile than Samsung Electronics Co. It trades about -0.1 of its total potential returns per unit of risk. Samsung Electronics Co is currently generating about 0.0 per unit of volatility. If you would invest 4,855,000 in Samsung Electronics Co on August 25, 2024 and sell it today you would lose (45,000) from holding Samsung Electronics Co or give up 0.93% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
People Technology vs. Samsung Electronics Co
Performance |
| Timeline |
| People Technology |
| Samsung Electronics |
People Technology and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with People Technology and Samsung Electronics
The main advantage of trading using opposite People Technology and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if People Technology 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.| People Technology vs. Samsung Electronics Co | People Technology vs. Samsung Electronics Co | People Technology vs. Hyundai Motor Co | People Technology vs. Hyundai Motor |
| Samsung Electronics vs. Youl Chon Chemical | Samsung Electronics vs. Dongnam Chemical Co | Samsung Electronics vs. Korea Information Engineering | Samsung Electronics vs. NICE Information Service |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing |