Correlation Between Samsung Electronics and NCC Group
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and NCC Group 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 NCC Group 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 NCC Group plc, you can compare the effects of market volatilities on Samsung Electronics and NCC Group 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 NCC Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and NCC Group.
Diversification Opportunities for Samsung Electronics and NCC Group
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Samsung and NCC is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and NCC Group plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NCC Group 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 NCC Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NCC Group plc has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and NCC Group go up and down completely randomly.
Pair Corralation between Samsung Electronics and NCC Group
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the NCC Group. But the stock apears to be less risky and, when comparing its historical volatility, Samsung Electronics Co is 1.53 times less risky than NCC Group. The stock trades about -0.02 of its potential returns per unit of risk. The NCC Group plc is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 14,379 in NCC Group plc on December 6, 2024 and sell it today you would lose (1,099) from holding NCC Group plc or give up 7.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. NCC Group plc
Performance |
| Timeline |
| Samsung Electronics |
| NCC Group plc |
Samsung Electronics and NCC Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and NCC Group
The main advantage of trading using opposite Samsung Electronics and NCC Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, NCC Group 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 NCC Group will offset losses from the drop in NCC Group's long position.| Samsung Electronics vs. Iron Mountain | Samsung Electronics vs. Sealed Air Corp | Samsung Electronics vs. Dentsply Sirona | Samsung Electronics vs. United States Steel |
| NCC Group vs. Impax Asset Management | NCC Group vs. International Biotechnology Trust | NCC Group vs. Science in Sport | NCC Group vs. Jupiter Fund Management |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals |