Correlation Between Samsung Electronics and Arcticzymes Technologies
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Arcticzymes Technologies 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 Arcticzymes Technologies 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 Arcticzymes Technologies ASA, you can compare the effects of market volatilities on Samsung Electronics and Arcticzymes Technologies 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 Arcticzymes Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Arcticzymes Technologies.
Diversification Opportunities for Samsung Electronics and Arcticzymes Technologies
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Samsung and Arcticzymes is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Arcticzymes Technologies ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arcticzymes Technologies 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 Arcticzymes Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arcticzymes Technologies has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Arcticzymes Technologies go up and down completely randomly.
Pair Corralation between Samsung Electronics and Arcticzymes Technologies
Assuming the 90 days trading horizon Samsung Electronics Co is expected to generate 0.56 times more return on investment than Arcticzymes Technologies. However, Samsung Electronics Co is 1.79 times less risky than Arcticzymes Technologies. It trades about -0.03 of its potential returns per unit of risk. Arcticzymes Technologies ASA is currently generating about -0.05 per unit of risk. If you would invest 121,704 in Samsung Electronics Co on September 4, 2024 and sell it today you would lose (25,954) from holding Samsung Electronics Co or give up 21.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.32% |
| Values | Daily Returns |
Samsung Electronics Co vs. Arcticzymes Technologies ASA
Performance |
| Timeline |
| Samsung Electronics |
| Arcticzymes Technologies |
Samsung Electronics and Arcticzymes Technologies Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Arcticzymes Technologies
The main advantage of trading using opposite Samsung Electronics and Arcticzymes Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Arcticzymes Technologies 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 Arcticzymes Technologies will offset losses from the drop in Arcticzymes Technologies' long position.| Samsung Electronics vs. FC Investment Trust | Samsung Electronics vs. Smithson Investment Trust | Samsung Electronics vs. Beeks Trading | Samsung Electronics vs. New Residential Investment |
| Arcticzymes Technologies vs. Samsung Electronics Co | Arcticzymes Technologies vs. Samsung Electronics Co | Arcticzymes Technologies vs. Hyundai Motor | Arcticzymes Technologies vs. Toyota Motor Corp |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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