Correlation Between Samsung Biologics and Sajo Ind
Can any of the company-specific risk be diversified away by investing in both Samsung Biologics and Sajo Ind 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 Samsung Biologics and Sajo Ind into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samsung Biologics Co and Sajo Ind, you can compare the effects of market volatilities on Samsung Biologics and Sajo Ind 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 Samsung Biologics with a short position of Sajo Ind. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Biologics and Sajo Ind.
Diversification Opportunities for Samsung Biologics and Sajo Ind
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Samsung and Sajo is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Biologics Co and Sajo Ind in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sajo Ind and Samsung Biologics 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 Samsung Biologics Co are associated (or correlated) with Sajo Ind. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sajo Ind has no effect on the direction of Samsung Biologics i.e., Samsung Biologics and Sajo Ind go up and down completely randomly.
Pair Corralation between Samsung Biologics and Sajo Ind
Assuming the 90 days trading horizon Samsung Biologics Co is expected to generate 0.46 times more return on investment than Sajo Ind. However, Samsung Biologics Co is 2.18 times less risky than Sajo Ind. It trades about 0.05 of its potential returns per unit of risk. Sajo Ind is currently generating about 0.01 per unit of risk. If you would invest 73,700,000 in Samsung Biologics Co on September 12, 2024 and sell it today you would earn a total of 22,200,000 from holding Samsung Biologics Co or generate 30.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.71% |
| Values | Daily Returns |
Samsung Biologics Co vs. Sajo Ind
Performance |
| Timeline |
| Samsung Biologics |
| Sajo Ind |
Samsung Biologics and Sajo Ind Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Biologics and Sajo Ind
The main advantage of trading using opposite Samsung Biologics and Sajo Ind positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Biologics position performs unexpectedly, Sajo Ind 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 Sajo Ind will offset losses from the drop in Sajo Ind's long position.| Samsung Biologics vs. SK Bioscience Co | Samsung Biologics vs. Sk Biopharmaceuticals Co | Samsung Biologics vs. ABL Bio | Samsung Biologics vs. Green Cross Lab |
| Sajo Ind vs. LG Household Healthcare | Sajo Ind vs. Nable Communications | Sajo Ind vs. Dongbu Insurance Co | Sajo Ind vs. Global Standard Technology |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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