Correlation Between Samsung Electronics and Hilton Worldwide
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Hilton Worldwide 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 Hilton Worldwide 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 Hilton Worldwide Holdings, you can compare the effects of market volatilities on Samsung Electronics and Hilton Worldwide 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 Hilton Worldwide. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Hilton Worldwide.
Diversification Opportunities for Samsung Electronics and Hilton Worldwide
-0.88 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Samsung and Hilton is -0.88. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Hilton Worldwide Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hilton Worldwide Holdings 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 Hilton Worldwide. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hilton Worldwide Holdings has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Hilton Worldwide go up and down completely randomly.
Pair Corralation between Samsung Electronics and Hilton Worldwide
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the Hilton Worldwide. In addition to that, Samsung Electronics is 1.31 times more volatile than Hilton Worldwide Holdings. It trades about -0.01 of its total potential returns per unit of risk. Hilton Worldwide Holdings is currently generating about 0.1 per unit of volatility. If you would invest 14,509 in Hilton Worldwide Holdings on August 27, 2024 and sell it today you would earn a total of 10,838 from holding Hilton Worldwide Holdings or generate 74.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 98.47% |
| Values | Daily Returns |
Samsung Electronics Co vs. Hilton Worldwide Holdings
Performance |
| Timeline |
| Samsung Electronics |
| Hilton Worldwide Holdings |
Samsung Electronics and Hilton Worldwide Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Hilton Worldwide
The main advantage of trading using opposite Samsung Electronics and Hilton Worldwide positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Hilton Worldwide 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 Hilton Worldwide will offset losses from the drop in Hilton Worldwide's long position.| Samsung Electronics vs. Futura Medical | Samsung Electronics vs. Evolution Gaming Group | Samsung Electronics vs. Games Workshop Group | Samsung Electronics vs. AMG Advanced Metallurgical |
| Hilton Worldwide vs. Alior Bank SA | Hilton Worldwide vs. Sabre Insurance Group | Hilton Worldwide vs. Cincinnati Financial Corp | Hilton Worldwide vs. Prudential Financial |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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