Correlation Between MITECH CoLtd and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both MITECH CoLtd 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 MITECH CoLtd and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MITECH CoLtd and Samsung Electronics Co, you can compare the effects of market volatilities on MITECH CoLtd 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 MITECH CoLtd with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of MITECH CoLtd and Samsung Electronics.
Diversification Opportunities for MITECH CoLtd and Samsung Electronics
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between MITECH and Samsung is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding MITECH CoLtd and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and MITECH CoLtd 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 MITECH CoLtd 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 MITECH CoLtd i.e., MITECH CoLtd and Samsung Electronics go up and down completely randomly.
Pair Corralation between MITECH CoLtd and Samsung Electronics
Assuming the 90 days trading horizon MITECH CoLtd is expected to generate 0.95 times more return on investment than Samsung Electronics. However, MITECH CoLtd is 1.05 times less risky than Samsung Electronics. It trades about 0.13 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about 0.11 per unit of risk. If you would invest 793,970 in MITECH CoLtd on October 12, 2024 and sell it today you would earn a total of 33,030 from holding MITECH CoLtd or generate 4.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
MITECH CoLtd vs. Samsung Electronics Co
Performance |
| Timeline |
| MITECH CoLtd |
| Samsung Electronics |
MITECH CoLtd and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MITECH CoLtd and Samsung Electronics
The main advantage of trading using opposite MITECH CoLtd and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MITECH CoLtd 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.| MITECH CoLtd vs. Samsung Electronics Co | MITECH CoLtd vs. Samsung Electronics Co | MITECH CoLtd vs. LG Energy Solution | MITECH CoLtd vs. SK Hynix |
| Samsung Electronics vs. PNC Technologies co | Samsung Electronics vs. Samsung Publishing Co | Samsung Electronics vs. Orbitech Co | Samsung Electronics vs. PH Tech Co |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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