Correlation Between Moadata and Samsung Fire
Can any of the company-specific risk be diversified away by investing in both Moadata and Samsung Fire 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 Moadata and Samsung Fire into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Moadata Co and Samsung Fire Marine, you can compare the effects of market volatilities on Moadata and Samsung Fire 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 Moadata with a short position of Samsung Fire. Check out your portfolio center. Please also check ongoing floating volatility patterns of Moadata and Samsung Fire.
Diversification Opportunities for Moadata and Samsung Fire
-0.19 | Correlation Coefficient |
Good diversification
The 3 months correlation between Moadata and Samsung is -0.19. Overlapping area represents the amount of risk that can be diversified away by holding Moadata Co and Samsung Fire Marine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Fire Marine and Moadata 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 Moadata Co are associated (or correlated) with Samsung Fire. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samsung Fire Marine has no effect on the direction of Moadata i.e., Moadata and Samsung Fire go up and down completely randomly.
Pair Corralation between Moadata and Samsung Fire
Assuming the 90 days trading horizon Moadata Co is expected to generate 1.83 times more return on investment than Samsung Fire. However, Moadata is 1.83 times more volatile than Samsung Fire Marine. It trades about 0.17 of its potential returns per unit of risk. Samsung Fire Marine is currently generating about -0.16 per unit of risk. If you would invest 125,000 in Moadata Co on October 30, 2024 and sell it today you would earn a total of 11,000 from holding Moadata Co or generate 8.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Moadata Co vs. Samsung Fire Marine
Performance |
| Timeline |
| Moadata |
| Samsung Fire Marine |
Moadata and Samsung Fire Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Moadata and Samsung Fire
The main advantage of trading using opposite Moadata and Samsung Fire positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Moadata position performs unexpectedly, Samsung Fire 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 Fire will offset losses from the drop in Samsung Fire's long position.| Moadata vs. PI Advanced Materials | Moadata vs. Nable Communications | Moadata vs. Innowireless Co | Moadata vs. Top Material Co |
| Samsung Fire vs. Ssangyong Information Communication | Samsung Fire vs. Lotte Non Life Insurance | Samsung Fire vs. Mobile Appliance | Samsung Fire vs. Innowireless 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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