Correlation Between Quaker Chemical and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both Quaker Chemical 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 Quaker Chemical and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Quaker Chemical and Samsung Electronics Co, you can compare the effects of market volatilities on Quaker Chemical 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 Quaker Chemical with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Quaker Chemical and Samsung Electronics.
Diversification Opportunities for Quaker Chemical and Samsung Electronics
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Quaker and Samsung is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Quaker Chemical and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and Quaker Chemical 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 Quaker Chemical 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 Quaker Chemical i.e., Quaker Chemical and Samsung Electronics go up and down completely randomly.
Pair Corralation between Quaker Chemical and Samsung Electronics
Assuming the 90 days horizon Quaker Chemical is expected to generate 1.14 times more return on investment than Samsung Electronics. However, Quaker Chemical is 1.14 times more volatile than Samsung Electronics Co. It trades about -0.01 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about -0.15 per unit of risk. If you would invest 15,150 in Quaker Chemical on September 3, 2024 and sell it today you would lose (550.00) from holding Quaker Chemical or give up 3.63% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Quaker Chemical vs. Samsung Electronics Co
Performance |
| Timeline |
| Quaker Chemical |
| Samsung Electronics |
Quaker Chemical and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Quaker Chemical and Samsung Electronics
The main advantage of trading using opposite Quaker Chemical and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Quaker Chemical 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.| Quaker Chemical vs. COMMERCIAL VEHICLE | Quaker Chemical vs. MOLSON RS BEVERAGE | Quaker Chemical vs. SENECA FOODS A | Quaker Chemical vs. TYSON FOODS A |
| Samsung Electronics vs. Quaker Chemical | Samsung Electronics vs. TIANDE CHEMICAL | Samsung Electronics vs. CARSALESCOM | Samsung Electronics vs. AIR PRODCHEMICALS |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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