Correlation Between Samsung Electronics and Tamburi Investment
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Tamburi Investment 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 Tamburi Investment 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 Tamburi Investment Partners, you can compare the effects of market volatilities on Samsung Electronics and Tamburi Investment 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 Tamburi Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Tamburi Investment.
Diversification Opportunities for Samsung Electronics and Tamburi Investment
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Samsung and Tamburi is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Tamburi Investment Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tamburi Investment 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 Tamburi Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tamburi Investment has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Tamburi Investment go up and down completely randomly.
Pair Corralation between Samsung Electronics and Tamburi Investment
Assuming the 90 days trading horizon Samsung Electronics Co is expected to generate 2.82 times more return on investment than Tamburi Investment. However, Samsung Electronics is 2.82 times more volatile than Tamburi Investment Partners. It trades about -0.08 of its potential returns per unit of risk. Tamburi Investment Partners is currently generating about -0.26 per unit of risk. If you would invest 106,900 in Samsung Electronics Co on August 30, 2024 and sell it today you would lose (7,300) from holding Samsung Electronics Co or give up 6.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. Tamburi Investment Partners
Performance |
| Timeline |
| Samsung Electronics |
| Tamburi Investment |
Samsung Electronics and Tamburi Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Tamburi Investment
The main advantage of trading using opposite Samsung Electronics and Tamburi Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Tamburi Investment 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 Tamburi Investment will offset losses from the drop in Tamburi Investment's long position.| Samsung Electronics vs. GoldMining | Samsung Electronics vs. Fortune Brands Home | Samsung Electronics vs. Cairn Homes PLC | Samsung Electronics vs. iShares Physical Silver |
| Tamburi Investment vs. Tungsten West PLC | Tamburi Investment vs. Argo Group Limited | Tamburi Investment vs. Hardide PLC | Tamburi Investment vs. Versarien PLC |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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