Correlation Between Samsung Electronics and Malvern International
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Malvern International 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 Malvern International 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 Malvern International, you can compare the effects of market volatilities on Samsung Electronics and Malvern International 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 Malvern International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Malvern International.
Diversification Opportunities for Samsung Electronics and Malvern International
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Samsung and Malvern is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Malvern International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Malvern International 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 Malvern International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Malvern International has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Malvern International go up and down completely randomly.
Pair Corralation between Samsung Electronics and Malvern International
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the Malvern International. In addition to that, Samsung Electronics is 1.02 times more volatile than Malvern International. It trades about -0.1 of its total potential returns per unit of risk. Malvern International is currently generating about 0.01 per unit of volatility. If you would invest 2,150 in Malvern International on September 3, 2024 and sell it today you would earn a total of 0.00 from holding Malvern International or generate 0.0% 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. Malvern International
Performance |
| Timeline |
| Samsung Electronics |
| Malvern International |
Samsung Electronics and Malvern International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Malvern International
The main advantage of trading using opposite Samsung Electronics and Malvern International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Malvern International 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 Malvern International will offset losses from the drop in Malvern International's long position.| Samsung Electronics vs. Coeur Mining | Samsung Electronics vs. Zoom Video Communications | Samsung Electronics vs. mobilezone holding AG | Samsung Electronics vs. Thor Mining PLC |
| Malvern International vs. Naked Wines plc | Malvern International vs. Ironveld Plc | Malvern International vs. Ally Financial | Malvern International vs. Sparebank 1 SR |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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