Correlation Between Woori Financial and Samsung Card
Can any of the company-specific risk be diversified away by investing in both Woori Financial and Samsung Card 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 Woori Financial and Samsung Card into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Woori Financial Group and Samsung Card Co, you can compare the effects of market volatilities on Woori Financial and Samsung Card 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 Woori Financial with a short position of Samsung Card. Check out your portfolio center. Please also check ongoing floating volatility patterns of Woori Financial and Samsung Card.
Diversification Opportunities for Woori Financial and Samsung Card
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Woori and Samsung is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Woori Financial Group and Samsung Card Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Card and Woori Financial 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 Woori Financial Group are associated (or correlated) with Samsung Card. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samsung Card has no effect on the direction of Woori Financial i.e., Woori Financial and Samsung Card go up and down completely randomly.
Pair Corralation between Woori Financial and Samsung Card
Assuming the 90 days trading horizon Woori Financial Group is expected to under-perform the Samsung Card. In addition to that, Woori Financial is 1.0 times more volatile than Samsung Card Co. It trades about -0.1 of its total potential returns per unit of risk. Samsung Card Co is currently generating about -0.03 per unit of volatility. If you would invest 4,045,000 in Samsung Card Co on September 12, 2024 and sell it today you would lose (55,000) from holding Samsung Card Co or give up 1.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Woori Financial Group vs. Samsung Card Co
Performance |
| Timeline |
| Woori Financial Group |
| Samsung Card |
Woori Financial and Samsung Card Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Woori Financial and Samsung Card
The main advantage of trading using opposite Woori Financial and Samsung Card positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Woori Financial position performs unexpectedly, Samsung Card 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 Card will offset losses from the drop in Samsung Card's long position.| Woori Financial vs. DB Insurance Co | Woori Financial vs. Pureun Mutual Savings | Woori Financial vs. Shinhan Financial Group | Woori Financial vs. iNtRON Biotechnology |
| Samsung Card vs. KB Financial Group | Samsung Card vs. Shinhan Financial Group | Samsung Card vs. Hana Financial | Samsung Card vs. Woori Financial Group |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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