Correlation Between PT Bank and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both PT Bank 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 PT Bank and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PT Bank Central and Samsung Electronics Co, you can compare the effects of market volatilities on PT Bank 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 PT Bank with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Bank and Samsung Electronics.
Diversification Opportunities for PT Bank and Samsung Electronics
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between PBCRF and Samsung is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding PT Bank Central and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and PT Bank 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 PT Bank Central 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 PT Bank i.e., PT Bank and Samsung Electronics go up and down completely randomly.
Pair Corralation between PT Bank and Samsung Electronics
Assuming the 90 days horizon PT Bank Central is expected to generate 60.84 times more return on investment than Samsung Electronics. However, PT Bank is 60.84 times more volatile than Samsung Electronics Co. It trades about 0.04 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about 0.1 per unit of risk. If you would invest 59.00 in PT Bank Central on September 1, 2024 and sell it today you would earn a total of 8.00 from holding PT Bank Central or generate 13.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.87% |
| Values | Daily Returns |
PT Bank Central vs. Samsung Electronics Co
Performance |
| Timeline |
| PT Bank Central |
| Samsung Electronics |
PT Bank and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Bank and Samsung Electronics
The main advantage of trading using opposite PT Bank and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Bank 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.| PT Bank vs. Piraeus Bank SA | PT Bank vs. Turkiye Garanti Bankasi | PT Bank vs. Delhi Bank Corp | PT Bank vs. Uwharrie Capital Corp |
| Samsung Electronics vs. Universal Electronics | Samsung Electronics vs. Vizio Holding Corp | Samsung Electronics vs. VOXX International | Samsung Electronics vs. Sony Group Corp |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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