Correlation Between FibraHotel and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both FibraHotel 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 FibraHotel and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between FibraHotel and Samsung Electronics Co, you can compare the effects of market volatilities on FibraHotel 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 FibraHotel with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of FibraHotel and Samsung Electronics.
Diversification Opportunities for FibraHotel and Samsung Electronics
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between FibraHotel and Samsung is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding FibraHotel and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and FibraHotel 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 FibraHotel 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 FibraHotel i.e., FibraHotel and Samsung Electronics go up and down completely randomly.
Pair Corralation between FibraHotel and Samsung Electronics
Assuming the 90 days trading horizon FibraHotel is expected to generate 1.18 times more return on investment than Samsung Electronics. However, FibraHotel is 1.18 times more volatile than Samsung Electronics Co. It trades about 0.21 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about -0.13 per unit of risk. If you would invest 780.00 in FibraHotel on August 25, 2024 and sell it today you would earn a total of 105.00 from holding FibraHotel or generate 13.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
FibraHotel vs. Samsung Electronics Co
Performance |
| Timeline |
| FibraHotel |
| Samsung Electronics |
FibraHotel and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with FibraHotel and Samsung Electronics
The main advantage of trading using opposite FibraHotel and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FibraHotel 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.| FibraHotel vs. Promotora y Operadora | FibraHotel vs. Megacable Holdings S | FibraHotel vs. ALPEK SAB de | FibraHotel vs. Gentera SAB de |
| Samsung Electronics vs. Monster Beverage Corp | Samsung Electronics vs. DXC Technology | Samsung Electronics vs. Deutsche Bank Aktiengesellschaft | Samsung Electronics vs. Cognizant Technology Solutions |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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