Correlation Between Samsung Electronics and National Atomic
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and National Atomic 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 National Atomic 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 National Atomic Co, you can compare the effects of market volatilities on Samsung Electronics and National Atomic 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 National Atomic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and National Atomic.
Diversification Opportunities for Samsung Electronics and National Atomic
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Samsung and National is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and National Atomic Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Atomic 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 National Atomic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Atomic has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and National Atomic go up and down completely randomly.
Pair Corralation between Samsung Electronics and National Atomic
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the National Atomic. But the stock apears to be less risky and, when comparing its historical volatility, Samsung Electronics Co is 1.43 times less risky than National Atomic. The stock trades about -0.01 of its potential returns per unit of risk. The National Atomic Co is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 2,563 in National Atomic Co on August 30, 2024 and sell it today you would earn a total of 1,407 from holding National Atomic Co or generate 54.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. National Atomic Co
Performance |
| Timeline |
| Samsung Electronics |
| National Atomic |
Samsung Electronics and National Atomic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and National Atomic
The main advantage of trading using opposite Samsung Electronics and National Atomic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, National Atomic 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 National Atomic will offset losses from the drop in National Atomic's long position.| Samsung Electronics vs. Ondine Biomedical | Samsung Electronics vs. Europa Metals | Samsung Electronics vs. Lendinvest PLC | Samsung Electronics vs. Neometals |
| National Atomic vs. Lendinvest PLC | National Atomic vs. Neometals | National Atomic vs. Coor Service Management | National Atomic vs. Albion Technology General |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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