Correlation Between National Storage and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both National Storage and Samsung Electronics 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 National Storage and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between National Storage Affiliates and Samsung Electronics Co, you can compare the effects of market volatilities on National Storage and Samsung Electronics 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 National Storage with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of National Storage and Samsung Electronics.
Diversification Opportunities for National Storage and Samsung Electronics
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between National and Samsung is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding National Storage Affiliates and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and National Storage 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 National Storage Affiliates are associated (or correlated) with Samsung Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samsung Electronics has no effect on the direction of National Storage i.e., National Storage and Samsung Electronics go up and down completely randomly.
Pair Corralation between National Storage and Samsung Electronics
Assuming the 90 days horizon National Storage Affiliates is expected to generate 0.72 times more return on investment than Samsung Electronics. However, National Storage Affiliates is 1.38 times less risky than Samsung Electronics. It trades about 0.14 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about -0.01 per unit of risk. If you would invest 3,956 in National Storage Affiliates on August 27, 2024 and sell it today you would earn a total of 233.00 from holding National Storage Affiliates or generate 5.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
National Storage Affiliates vs. Samsung Electronics Co
Performance |
| Timeline |
| National Storage Aff |
| Samsung Electronics |
National Storage and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with National Storage and Samsung Electronics
The main advantage of trading using opposite National Storage and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if National Storage position performs unexpectedly, Samsung Electronics 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 Electronics will offset losses from the drop in Samsung Electronics' long position.| National Storage vs. Superior Plus Corp | National Storage vs. Origin Agritech | National Storage vs. Identiv | National Storage vs. INTUITIVE SURGICAL |
| Samsung Electronics vs. Ryanair Holdings plc | Samsung Electronics vs. DATANG INTL POW | Samsung Electronics vs. National Storage Affiliates | Samsung Electronics vs. WIZZ AIR HLDGUNSPADR4 |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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