Correlation Between PT Solusi and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both PT Solusi 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 Solusi 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 Solusi Bangun and Samsung Electronics Co, you can compare the effects of market volatilities on PT Solusi 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 Solusi with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of PT Solusi and Samsung Electronics.
Diversification Opportunities for PT Solusi and Samsung Electronics
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between RU6 and Samsung is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding PT Solusi Bangun 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 Solusi 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 Solusi Bangun 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 Solusi i.e., PT Solusi and Samsung Electronics go up and down completely randomly.
Pair Corralation between PT Solusi and Samsung Electronics
Assuming the 90 days horizon PT Solusi Bangun is expected to generate 11.73 times more return on investment than Samsung Electronics. However, PT Solusi is 11.73 times more volatile than Samsung Electronics Co. It trades about 0.05 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about -0.04 per unit of risk. If you would invest 8.55 in PT Solusi Bangun on August 24, 2024 and sell it today you would lose (5.05) from holding PT Solusi Bangun or give up 59.06% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
PT Solusi Bangun vs. Samsung Electronics Co
Performance |
| Timeline |
| PT Solusi Bangun |
| Samsung Electronics |
PT Solusi and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PT Solusi and Samsung Electronics
The main advantage of trading using opposite PT Solusi and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PT Solusi 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 Solusi vs. Vulcan Materials | PT Solusi vs. Origin Agritech | PT Solusi vs. SIVERS SEMICONDUCTORS AB | PT Solusi vs. Talanx AG |
| Samsung Electronics vs. UMC Electronics Co | Samsung Electronics vs. STMICROELECTRONICS | Samsung Electronics vs. Tyson Foods | Samsung Electronics vs. Zoom Video Communications |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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