Correlation Between Samsung Electronics and Sealed Air
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Sealed Air 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 Sealed Air 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 Sealed Air Corp, you can compare the effects of market volatilities on Samsung Electronics and Sealed Air 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 Sealed Air. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Sealed Air.
Diversification Opportunities for Samsung Electronics and Sealed Air
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Samsung and Sealed is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Sealed Air Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sealed Air 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 Sealed Air. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sealed Air Corp has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Sealed Air go up and down completely randomly.
Pair Corralation between Samsung Electronics and Sealed Air
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the Sealed Air. In addition to that, Samsung Electronics is 1.66 times more volatile than Sealed Air Corp. It trades about -0.07 of its total potential returns per unit of risk. Sealed Air Corp is currently generating about -0.08 per unit of volatility. If you would invest 3,666 in Sealed Air Corp on November 6, 2024 and sell it today you would lose (273.00) from holding Sealed Air Corp or give up 7.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 93.44% |
| Values | Daily Returns |
Samsung Electronics Co vs. Sealed Air Corp
Performance |
| Timeline |
| Samsung Electronics |
| Sealed Air Corp |
Samsung Electronics and Sealed Air Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Sealed Air
The main advantage of trading using opposite Samsung Electronics and Sealed Air positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Sealed Air 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 Sealed Air will offset losses from the drop in Sealed Air's long position.| Samsung Electronics vs. Optima Health plc | Samsung Electronics vs. Abingdon Health Plc | Samsung Electronics vs. CVS Health Corp | Samsung Electronics vs. Automatic Data Processing |
| Sealed Air vs. Vienna Insurance Group | Sealed Air vs. United Airlines Holdings | Sealed Air vs. International Consolidated Airlines | Sealed Air vs. Sabre Insurance Group |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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