Correlation Between Deltex Medical and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both Deltex Medical 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 Deltex Medical and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Deltex Medical Group and Samsung Electronics Co, you can compare the effects of market volatilities on Deltex Medical 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 Deltex Medical with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Deltex Medical and Samsung Electronics.
Diversification Opportunities for Deltex Medical and Samsung Electronics
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Deltex and Samsung is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Deltex Medical Group and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and Deltex Medical 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 Deltex Medical Group 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 Deltex Medical i.e., Deltex Medical and Samsung Electronics go up and down completely randomly.
Pair Corralation between Deltex Medical and Samsung Electronics
Assuming the 90 days trading horizon Deltex Medical Group is expected to under-perform the Samsung Electronics. In addition to that, Deltex Medical is 2.9 times more volatile than Samsung Electronics Co. It trades about -0.07 of its total potential returns per unit of risk. Samsung Electronics Co is currently generating about -0.04 per unit of volatility. If you would invest 134,012 in Samsung Electronics Co on November 28, 2024 and sell it today you would lose (35,012) from holding Samsung Electronics Co or give up 26.13% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.4% |
| Values | Daily Returns |
Deltex Medical Group vs. Samsung Electronics Co
Performance |
| Timeline |
| Deltex Medical Group |
| Samsung Electronics |
Deltex Medical and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Deltex Medical and Samsung Electronics
The main advantage of trading using opposite Deltex Medical and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Deltex Medical 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.| Deltex Medical vs. Resolute Mining Limited | Deltex Medical vs. Automatic Data Processing | Deltex Medical vs. Empire Metals Limited | Deltex Medical vs. GreenX Metals |
| Samsung Electronics vs. Metals Exploration Plc | Samsung Electronics vs. Central Asia Metals | Samsung Electronics vs. Young Cos Brewery | Samsung Electronics vs. Wheaton Precious Metals |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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