Correlation Between Samsung Electronics and North Atlantic
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and North Atlantic 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 North Atlantic 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 North Atlantic Smaller, you can compare the effects of market volatilities on Samsung Electronics and North Atlantic 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 North Atlantic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and North Atlantic.
Diversification Opportunities for Samsung Electronics and North Atlantic
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Samsung and North is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and North Atlantic Smaller in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on North Atlantic Smaller 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 North Atlantic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of North Atlantic Smaller has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and North Atlantic go up and down completely randomly.
Pair Corralation between Samsung Electronics and North Atlantic
If you would invest 0.00 in North Atlantic Smaller on September 19, 2024 and sell it today you would earn a total of 0.00 from holding North Atlantic Smaller or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 4.55% |
Values | Daily Returns |
Samsung Electronics Co vs. North Atlantic Smaller
Performance |
Timeline |
Samsung Electronics |
North Atlantic Smaller |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Samsung Electronics and North Atlantic Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Samsung Electronics and North Atlantic
The main advantage of trading using opposite Samsung Electronics and North Atlantic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, North Atlantic 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 North Atlantic will offset losses from the drop in North Atlantic's long position.Samsung Electronics vs. Rockfire Resources plc | ||
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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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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