Correlation Between Intuit and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both Intuit 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 Intuit and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intuit Inc and Samsung Electronics Co, you can compare the effects of market volatilities on Intuit 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 Intuit with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intuit and Samsung Electronics.
Diversification Opportunities for Intuit and Samsung Electronics
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Intuit and Samsung is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Intuit Inc and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and Intuit 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 Intuit Inc 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 Intuit i.e., Intuit and Samsung Electronics go up and down completely randomly.
Pair Corralation between Intuit and Samsung Electronics
Assuming the 90 days trading horizon Intuit Inc is expected to generate 1.26 times more return on investment than Samsung Electronics. However, Intuit is 1.26 times more volatile than Samsung Electronics Co. It trades about 0.12 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about -0.14 per unit of risk. If you would invest 1,220,088 in Intuit Inc on August 27, 2024 and sell it today you would earn a total of 91,022 from holding Intuit Inc or generate 7.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Intuit Inc vs. Samsung Electronics Co
Performance |
| Timeline |
| Intuit Inc |
| Samsung Electronics |
Intuit and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intuit and Samsung Electronics
The main advantage of trading using opposite Intuit and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intuit 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.| Intuit vs. DXC Technology | Intuit vs. Southern Copper | Intuit vs. Grupo Sports World | Intuit vs. Verizon Communications |
| Samsung Electronics vs. Apple Inc | Samsung Electronics vs. The Select Sector | Samsung Electronics vs. Promotora y Operadora | Samsung Electronics vs. iShares Global Timber |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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