Correlation Between SAMG Entertainment and Hanwha Life
Can any of the company-specific risk be diversified away by investing in both SAMG Entertainment and Hanwha Life 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 SAMG Entertainment and Hanwha Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SAMG Entertainment Co and Hanwha Life Insurance, you can compare the effects of market volatilities on SAMG Entertainment and Hanwha Life 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 SAMG Entertainment with a short position of Hanwha Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of SAMG Entertainment and Hanwha Life.
Diversification Opportunities for SAMG Entertainment and Hanwha Life
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SAMG and Hanwha is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding SAMG Entertainment Co and Hanwha Life Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hanwha Life Insurance and SAMG Entertainment 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 SAMG Entertainment Co are associated (or correlated) with Hanwha Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hanwha Life Insurance has no effect on the direction of SAMG Entertainment i.e., SAMG Entertainment and Hanwha Life go up and down completely randomly.
Pair Corralation between SAMG Entertainment and Hanwha Life
Assuming the 90 days trading horizon SAMG Entertainment Co is expected to generate 2.43 times more return on investment than Hanwha Life. However, SAMG Entertainment is 2.43 times more volatile than Hanwha Life Insurance. It trades about 0.09 of its potential returns per unit of risk. Hanwha Life Insurance is currently generating about -0.07 per unit of risk. If you would invest 954,000 in SAMG Entertainment Co on October 30, 2024 and sell it today you would earn a total of 585,000 from holding SAMG Entertainment Co or generate 61.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SAMG Entertainment Co vs. Hanwha Life Insurance
Performance |
| Timeline |
| SAMG Entertainment |
| Hanwha Life Insurance |
SAMG Entertainment and Hanwha Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SAMG Entertainment and Hanwha Life
The main advantage of trading using opposite SAMG Entertainment and Hanwha Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SAMG Entertainment position performs unexpectedly, Hanwha Life 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 Hanwha Life will offset losses from the drop in Hanwha Life's long position.| SAMG Entertainment vs. DB Financial Investment | SAMG Entertainment vs. Settlebank | SAMG Entertainment vs. Pureun Mutual Savings | SAMG Entertainment vs. Jeju Bank |
| Hanwha Life vs. Korea Computer | Hanwha Life vs. Inzi Display CoLtd | Hanwha Life vs. Tae Kyung Chemical | Hanwha Life vs. TK Chemical |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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