Correlation Between Ross Stores and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both Ross Stores 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 Ross Stores and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ross Stores and Samsung Electronics Co, you can compare the effects of market volatilities on Ross Stores 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 Ross Stores with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ross Stores and Samsung Electronics.
Diversification Opportunities for Ross Stores and Samsung Electronics
-0.77 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Ross and Samsung is -0.77. Overlapping area represents the amount of risk that can be diversified away by holding Ross Stores and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and Ross Stores 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 Ross Stores 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 Ross Stores i.e., Ross Stores and Samsung Electronics go up and down completely randomly.
Pair Corralation between Ross Stores and Samsung Electronics
Assuming the 90 days trading horizon Ross Stores is expected to generate 1.27 times more return on investment than Samsung Electronics. However, Ross Stores is 1.27 times more volatile than Samsung Electronics Co. It trades about 0.07 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about 0.0 per unit of risk. If you would invest 232,900 in Ross Stores on August 27, 2024 and sell it today you would earn a total of 65,230 from holding Ross Stores or generate 28.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 32.12% |
| Values | Daily Returns |
Ross Stores vs. Samsung Electronics Co
Performance |
| Timeline |
| Ross Stores |
| Samsung Electronics |
Ross Stores and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ross Stores and Samsung Electronics
The main advantage of trading using opposite Ross Stores and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ross Stores 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.| Ross Stores vs. Glencore plc | Ross Stores vs. iShares Trust | Ross Stores vs. US Bancorp | Ross Stores vs. American Express |
| Samsung Electronics vs. DXC Technology | Samsung Electronics vs. Taiwan Semiconductor Manufacturing | Samsung Electronics vs. Ross Stores | Samsung Electronics vs. Burlington Stores |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
Other Complementary Tools
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments |