Correlation Between State Bank and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both State 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 State 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 State Bank of and Samsung Electronics Co, you can compare the effects of market volatilities on State 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 State Bank with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of State Bank and Samsung Electronics.
Diversification Opportunities for State Bank and Samsung Electronics
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between State and Samsung is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding State Bank of and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and State 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 State Bank of 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 State Bank i.e., State Bank and Samsung Electronics go up and down completely randomly.
Pair Corralation between State Bank and Samsung Electronics
Assuming the 90 days trading horizon State Bank of is expected to generate 0.76 times more return on investment than Samsung Electronics. However, State Bank of is 1.32 times less risky than Samsung Electronics. It trades about 0.14 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about 0.01 per unit of risk. If you would invest 9,400 in State Bank of on August 28, 2024 and sell it today you would earn a total of 560.00 from holding State Bank of or generate 5.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
State Bank of vs. Samsung Electronics Co
Performance |
| Timeline |
| State Bank |
| Samsung Electronics |
State Bank and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with State Bank and Samsung Electronics
The main advantage of trading using opposite State Bank and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if State 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.| State Bank vs. Abingdon Health Plc | State Bank vs. Lords Grp Trading | State Bank vs. The Mercantile Investment | State Bank vs. Naturhouse Health SA |
| Samsung Electronics vs. Toyota Motor Corp | Samsung Electronics vs. SoftBank Group Corp | Samsung Electronics vs. OTP Bank Nyrt | Samsung Electronics vs. Las Vegas Sands |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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