Correlation Between Samsung Electronics and National Beverage
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and National Beverage 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 National Beverage 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 National Beverage Corp, you can compare the effects of market volatilities on Samsung Electronics and National Beverage 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 National Beverage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and National Beverage.
Diversification Opportunities for Samsung Electronics and National Beverage
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Samsung and National is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and National Beverage Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Beverage Corp 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 National Beverage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Beverage Corp has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and National Beverage go up and down completely randomly.
Pair Corralation between Samsung Electronics and National Beverage
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the National Beverage. In addition to that, Samsung Electronics is 1.2 times more volatile than National Beverage Corp. It trades about -0.19 of its total potential returns per unit of risk. National Beverage Corp is currently generating about -0.07 per unit of volatility. If you would invest 4,321 in National Beverage Corp on November 5, 2024 and sell it today you would lose (93.00) from holding National Beverage Corp or give up 2.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. National Beverage Corp
Performance |
| Timeline |
| Samsung Electronics |
| National Beverage Corp |
Samsung Electronics and National Beverage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and National Beverage
The main advantage of trading using opposite Samsung Electronics and National Beverage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, National Beverage 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 National Beverage will offset losses from the drop in National Beverage's long position.| Samsung Electronics vs. Metro Bank PLC | Samsung Electronics vs. Regions Financial Corp | Samsung Electronics vs. Zurich Insurance Group | Samsung Electronics vs. Raymond James Financial |
| National Beverage vs. Invesco Physical Silver | National Beverage vs. Fortuna Silver Mines | National Beverage vs. Griffin Mining | National Beverage vs. DXC Technology Co |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |