Correlation Between Samsung Electronics and Cardinal Health
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Cardinal Health 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 Cardinal Health 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 Cardinal Health, you can compare the effects of market volatilities on Samsung Electronics and Cardinal Health 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 Cardinal Health. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Cardinal Health.
Diversification Opportunities for Samsung Electronics and Cardinal Health
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Samsung and Cardinal is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Cardinal Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cardinal Health 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 Cardinal Health. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cardinal Health has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Cardinal Health go up and down completely randomly.
Pair Corralation between Samsung Electronics and Cardinal Health
Assuming the 90 days trading horizon Samsung Electronics Co is expected to generate 2.33 times more return on investment than Cardinal Health. However, Samsung Electronics is 2.33 times more volatile than Cardinal Health. It trades about -0.03 of its potential returns per unit of risk. Cardinal Health is currently generating about -0.14 per unit of risk. If you would invest 97,950 in Samsung Electronics Co on September 12, 2024 and sell it today you would lose (3,050) from holding Samsung Electronics Co or give up 3.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. Cardinal Health
Performance |
| Timeline |
| Samsung Electronics |
| Cardinal Health |
Samsung Electronics and Cardinal Health Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Cardinal Health
The main advantage of trading using opposite Samsung Electronics and Cardinal Health positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Cardinal Health 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 Cardinal Health will offset losses from the drop in Cardinal Health's long position.| Samsung Electronics vs. McEwen Mining | Samsung Electronics vs. United Utilities Group | Samsung Electronics vs. Coor Service Management | Samsung Electronics vs. Jupiter Fund Management |
| Cardinal Health vs. Hong Kong Land | Cardinal Health vs. Neometals | Cardinal Health vs. Coor Service Management | Cardinal Health vs. Fidelity Sustainable USD |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
Other Complementary Tools
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |