Correlation Between Samsung Electronics and Bisichi Mining
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Bisichi Mining 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 Bisichi Mining 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 Bisichi Mining PLC, you can compare the effects of market volatilities on Samsung Electronics and Bisichi Mining 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 Bisichi Mining. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Bisichi Mining.
Diversification Opportunities for Samsung Electronics and Bisichi Mining
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Samsung and Bisichi is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Bisichi Mining PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bisichi Mining PLC 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 Bisichi Mining. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bisichi Mining PLC has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Bisichi Mining go up and down completely randomly.
Pair Corralation between Samsung Electronics and Bisichi Mining
Assuming the 90 days trading horizon Samsung Electronics Co is expected to generate 1.43 times more return on investment than Bisichi Mining. However, Samsung Electronics is 1.43 times more volatile than Bisichi Mining PLC. It trades about -0.06 of its potential returns per unit of risk. Bisichi Mining PLC is currently generating about -0.09 per unit of risk. If you would invest 87,800 in Samsung Electronics Co on September 2, 2024 and sell it today you would lose (4,000) from holding Samsung Electronics Co or give up 4.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. Bisichi Mining PLC
Performance |
| Timeline |
| Samsung Electronics |
| Bisichi Mining PLC |
Samsung Electronics and Bisichi Mining Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Bisichi Mining
The main advantage of trading using opposite Samsung Electronics and Bisichi Mining positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Bisichi Mining 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 Bisichi Mining will offset losses from the drop in Bisichi Mining's long position.| Samsung Electronics vs. Playtech Plc | Samsung Electronics vs. Schweiter Technologies AG | Samsung Electronics vs. Datalogic | Samsung Electronics vs. Teradata Corp |
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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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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