Correlation Between Schroders Investment and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both Schroders Investment 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 Schroders Investment and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Schroders Investment Trusts and Samsung Electronics Co, you can compare the effects of market volatilities on Schroders Investment 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 Schroders Investment with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Schroders Investment and Samsung Electronics.
Diversification Opportunities for Schroders Investment and Samsung Electronics
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Schroders and Samsung is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Schroders Investment Trusts and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and Schroders Investment 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 Schroders Investment Trusts 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 Schroders Investment i.e., Schroders Investment and Samsung Electronics go up and down completely randomly.
Pair Corralation between Schroders Investment and Samsung Electronics
Assuming the 90 days trading horizon Schroders Investment Trusts is expected to generate 0.42 times more return on investment than Samsung Electronics. However, Schroders Investment Trusts is 2.37 times less risky than Samsung Electronics. It trades about 0.06 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about -0.11 per unit of risk. If you would invest 44,900 in Schroders Investment Trusts on August 26, 2024 and sell it today you would earn a total of 3,000 from holding Schroders Investment Trusts or generate 6.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Schroders Investment Trusts vs. Samsung Electronics Co
Performance |
| Timeline |
| Schroders Investment |
| Samsung Electronics |
Schroders Investment and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Schroders Investment and Samsung Electronics
The main advantage of trading using opposite Schroders Investment and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Schroders Investment 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.| Schroders Investment vs. Catalyst Media Group | Schroders Investment vs. Oncimmune Holdings plc | Schroders Investment vs. Invesco Health Care | Schroders Investment vs. Coor Service Management |
| Samsung Electronics vs. Taylor Maritime Investments | Samsung Electronics vs. Monks Investment Trust | Samsung Electronics vs. Schroders Investment Trusts | Samsung Electronics vs. Aurora Investment Trust |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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