Correlation Between ACE NASDAQ100 and Samsung KODEX
Can any of the company-specific risk be diversified away by investing in both ACE NASDAQ100 and Samsung KODEX 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 ACE NASDAQ100 and Samsung KODEX into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ACE NASDAQ100 3070 and Samsung KODEX Copper, you can compare the effects of market volatilities on ACE NASDAQ100 and Samsung KODEX 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 ACE NASDAQ100 with a short position of Samsung KODEX. Check out your portfolio center. Please also check ongoing floating volatility patterns of ACE NASDAQ100 and Samsung KODEX.
Diversification Opportunities for ACE NASDAQ100 and Samsung KODEX
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ACE and Samsung is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding ACE NASDAQ100 3070 and Samsung KODEX Copper in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung KODEX Copper and ACE NASDAQ100 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 ACE NASDAQ100 3070 are associated (or correlated) with Samsung KODEX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samsung KODEX Copper has no effect on the direction of ACE NASDAQ100 i.e., ACE NASDAQ100 and Samsung KODEX go up and down completely randomly.
Pair Corralation between ACE NASDAQ100 and Samsung KODEX
Assuming the 90 days trading horizon ACE NASDAQ100 is expected to generate 9.8 times less return on investment than Samsung KODEX. But when comparing it to its historical volatility, ACE NASDAQ100 3070 is 2.08 times less risky than Samsung KODEX. It trades about 0.1 of its potential returns per unit of risk. Samsung KODEX Copper is currently generating about 0.46 of returns per unit of risk over similar time horizon. If you would invest 691,500 in Samsung KODEX Copper on October 21, 2024 and sell it today you would earn a total of 60,500 from holding Samsung KODEX Copper or generate 8.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ACE NASDAQ100 3070 vs. Samsung KODEX Copper
Performance |
| Timeline |
| ACE NASDAQ100 3070 |
| Samsung KODEX Copper |
ACE NASDAQ100 and Samsung KODEX Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ACE NASDAQ100 and Samsung KODEX
The main advantage of trading using opposite ACE NASDAQ100 and Samsung KODEX positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ACE NASDAQ100 position performs unexpectedly, Samsung KODEX 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 KODEX will offset losses from the drop in Samsung KODEX's long position.| ACE NASDAQ100 vs. Samsung Asset Management | ACE NASDAQ100 vs. Samsung Kodex Korea | ACE NASDAQ100 vs. Shinhan Dollar Index | ACE NASDAQ100 vs. KIM KINDEX SP500 |
| Samsung KODEX vs. Samsung Asset Management | Samsung KODEX vs. Samsung Kodex Korea | Samsung KODEX vs. Shinhan Dollar Index | Samsung KODEX vs. KIM KINDEX SP500 |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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