Correlation Between Abrdn PLC and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both Abrdn PLC 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 Abrdn PLC and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Abrdn PLC and Samsung Electronics Co, you can compare the effects of market volatilities on Abrdn PLC 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 Abrdn PLC with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Abrdn PLC and Samsung Electronics.
Diversification Opportunities for Abrdn PLC and Samsung Electronics
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Abrdn and Samsung is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Abrdn PLC and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and Abrdn PLC 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 Abrdn PLC 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 Abrdn PLC i.e., Abrdn PLC and Samsung Electronics go up and down completely randomly.
Pair Corralation between Abrdn PLC and Samsung Electronics
Assuming the 90 days trading horizon Abrdn PLC is expected to generate 0.4 times more return on investment than Samsung Electronics. However, Abrdn PLC is 2.52 times less risky than Samsung Electronics. It trades about 0.22 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about -0.09 per unit of risk. If you would invest 13,215 in Abrdn PLC on September 1, 2024 and sell it today you would earn a total of 875.00 from holding Abrdn PLC or generate 6.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Abrdn PLC vs. Samsung Electronics Co
Performance |
| Timeline |
| Abrdn PLC |
| Samsung Electronics |
Abrdn PLC and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Abrdn PLC and Samsung Electronics
The main advantage of trading using opposite Abrdn PLC and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Abrdn PLC 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.| Abrdn PLC vs. Samsung Electronics Co | Abrdn PLC vs. Samsung Electronics Co | Abrdn PLC vs. Hyundai Motor | Abrdn PLC vs. Toyota Motor Corp |
| Samsung Electronics vs. Ecclesiastical Insurance Office | Samsung Electronics vs. FC Investment Trust | Samsung Electronics vs. New Residential Investment | Samsung Electronics vs. DFS Furniture PLC |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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