Correlation Between Samsung Electronics and EVS Broadcast
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and EVS Broadcast 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 EVS Broadcast 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 EVS Broadcast Equipment, you can compare the effects of market volatilities on Samsung Electronics and EVS Broadcast 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 EVS Broadcast. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and EVS Broadcast.
Diversification Opportunities for Samsung Electronics and EVS Broadcast
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Samsung and EVS is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and EVS Broadcast Equipment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on EVS Broadcast Equipment 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 EVS Broadcast. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of EVS Broadcast Equipment has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and EVS Broadcast go up and down completely randomly.
Pair Corralation between Samsung Electronics and EVS Broadcast
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the EVS Broadcast. In addition to that, Samsung Electronics is 1.69 times more volatile than EVS Broadcast Equipment. It trades about 0.0 of its total potential returns per unit of risk. EVS Broadcast Equipment is currently generating about 0.02 per unit of volatility. If you would invest 2,859 in EVS Broadcast Equipment on August 26, 2024 and sell it today you would earn a total of 11.00 from holding EVS Broadcast Equipment or generate 0.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. EVS Broadcast Equipment
Performance |
| Timeline |
| Samsung Electronics |
| EVS Broadcast Equipment |
Samsung Electronics and EVS Broadcast Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and EVS Broadcast
The main advantage of trading using opposite Samsung Electronics and EVS Broadcast positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, EVS Broadcast 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 EVS Broadcast will offset losses from the drop in EVS Broadcast's long position.| Samsung Electronics vs. Toyota Motor Corp | Samsung Electronics vs. SoftBank Group Corp | Samsung Electronics vs. OTP Bank Nyrt | Samsung Electronics vs. Las Vegas Sands |
| EVS Broadcast vs. Samsung Electronics Co | EVS Broadcast vs. Samsung Electronics Co | EVS Broadcast vs. Hyundai Motor | EVS Broadcast vs. Toyota Motor Corp |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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