Correlation Between Samsung Electronics and Uber Technologies
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Uber Technologies 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 Samsung Electronics and Uber Technologies into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samsung Electronics Co and Uber Technologies, you can compare the effects of market volatilities on Samsung Electronics and Uber Technologies 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 Samsung Electronics with a short position of Uber Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Uber Technologies.
Diversification Opportunities for Samsung Electronics and Uber Technologies
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Samsung and Uber is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Uber Technologies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Uber Technologies and Samsung Electronics 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 Samsung Electronics Co are associated (or correlated) with Uber Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Uber Technologies has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Uber Technologies go up and down completely randomly.
Pair Corralation between Samsung Electronics and Uber Technologies
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the Uber Technologies. In addition to that, Samsung Electronics is 3.19 times more volatile than Uber Technologies. It trades about -0.05 of its total potential returns per unit of risk. Uber Technologies is currently generating about 0.21 per unit of volatility. If you would invest 6,920 in Uber Technologies on September 1, 2024 and sell it today you would earn a total of 295.00 from holding Uber Technologies or generate 4.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. Uber Technologies
Performance |
| Timeline |
| Samsung Electronics |
| Uber Technologies |
Samsung Electronics and Uber Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Uber Technologies
The main advantage of trading using opposite Samsung Electronics and Uber Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Uber Technologies 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 Uber Technologies will offset losses from the drop in Uber Technologies' long position.| Samsung Electronics vs. Roebuck Food Group | Samsung Electronics vs. Molson Coors Beverage | Samsung Electronics vs. United Utilities Group | Samsung Electronics vs. Premier Foods PLC |
| Uber Technologies vs. Naturhouse Health SA | Uber Technologies vs. HCA Healthcare | Uber Technologies vs. Inspiration Healthcare Group | Uber Technologies vs. Science in Sport |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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