Correlation Between Samsung Electronics and Geely Automobile
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Geely Automobile 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 Geely Automobile 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 Geely Automobile Holdings, you can compare the effects of market volatilities on Samsung Electronics and Geely Automobile 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 Geely Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Geely Automobile.
Diversification Opportunities for Samsung Electronics and Geely Automobile
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Samsung and Geely is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Geely Automobile Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Geely Automobile Holdings 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 Geely Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Geely Automobile Holdings has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Geely Automobile go up and down completely randomly.
Pair Corralation between Samsung Electronics and Geely Automobile
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the Geely Automobile. But the stock apears to be less risky and, when comparing its historical volatility, Samsung Electronics Co is 1.76 times less risky than Geely Automobile. The stock trades about -0.13 of its potential returns per unit of risk. The Geely Automobile Holdings is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 1,500 in Geely Automobile Holdings on November 8, 2024 and sell it today you would earn a total of 0.00 from holding Geely Automobile Holdings or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Samsung Electronics Co vs. Geely Automobile Holdings
Performance |
| Timeline |
| Samsung Electronics |
| Geely Automobile Holdings |
Samsung Electronics and Geely Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Geely Automobile
The main advantage of trading using opposite Samsung Electronics and Geely Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Geely Automobile 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 Geely Automobile will offset losses from the drop in Geely Automobile's long position.| Samsung Electronics vs. Allianz Technology Trust | Samsung Electronics vs. Vitec Software Group | Samsung Electronics vs. Sunny Optical Technology | Samsung Electronics vs. Tyson Foods Cl |
| Geely Automobile vs. Target Healthcare REIT | Geely Automobile vs. Ebro Foods | Geely Automobile vs. Omega Healthcare Investors | Geely Automobile vs. Premier Foods PLC |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings |