Correlation Between Octopus Aim and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both Octopus Aim 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 Octopus Aim and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Octopus Aim Vct and Samsung Electronics Co, you can compare the effects of market volatilities on Octopus Aim 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 Octopus Aim with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Octopus Aim and Samsung Electronics.
Diversification Opportunities for Octopus Aim and Samsung Electronics
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Octopus and Samsung is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Octopus Aim Vct and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and Octopus Aim 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 Octopus Aim Vct 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 Octopus Aim i.e., Octopus Aim and Samsung Electronics go up and down completely randomly.
Pair Corralation between Octopus Aim and Samsung Electronics
Assuming the 90 days trading horizon Octopus Aim Vct is expected to generate 0.18 times more return on investment than Samsung Electronics. However, Octopus Aim Vct is 5.48 times less risky than Samsung Electronics. It trades about 0.13 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about -0.42 per unit of risk. If you would invest 4,883 in Octopus Aim Vct on September 24, 2024 and sell it today you would earn a total of 42.00 from holding Octopus Aim Vct or generate 0.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Octopus Aim Vct vs. Samsung Electronics Co
Performance |
| Timeline |
| Octopus Aim Vct |
| Samsung Electronics |
Octopus Aim and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Octopus Aim and Samsung Electronics
The main advantage of trading using opposite Octopus Aim and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Octopus Aim 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.| Octopus Aim vs. Samsung Electronics Co | Octopus Aim vs. Samsung Electronics Co | Octopus Aim vs. Hyundai Motor | Octopus Aim vs. Toyota Motor Corp |
| Samsung Electronics vs. Rockfire Resources plc | Samsung Electronics vs. Tlou Energy | Samsung Electronics vs. Ikigai Ventures | Samsung Electronics vs. Falcon Oil Gas |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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