Correlation Between Samsung Electronics and Vitec Software
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Vitec Software 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 Vitec Software 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 Vitec Software Group, you can compare the effects of market volatilities on Samsung Electronics and Vitec Software 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 Vitec Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Vitec Software.
Diversification Opportunities for Samsung Electronics and Vitec Software
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Samsung and Vitec is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Vitec Software Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vitec Software Group 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 Vitec Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vitec Software Group has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Vitec Software go up and down completely randomly.
Pair Corralation between Samsung Electronics and Vitec Software
Assuming the 90 days trading horizon Samsung Electronics is expected to generate 1.05 times less return on investment than Vitec Software. But when comparing it to its historical volatility, Samsung Electronics Co is 1.49 times less risky than Vitec Software. It trades about 0.1 of its potential returns per unit of risk. Vitec Software Group is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 54,409 in Vitec Software Group on October 29, 2024 and sell it today you would earn a total of 1,741 from holding Vitec Software Group or generate 3.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. Vitec Software Group
Performance |
| Timeline |
| Samsung Electronics |
| Vitec Software Group |
Samsung Electronics and Vitec Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Vitec Software
The main advantage of trading using opposite Samsung Electronics and Vitec Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Vitec Software 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 Vitec Software will offset losses from the drop in Vitec Software's long position.| Samsung Electronics vs. Lundin Mining Corp | Samsung Electronics vs. Impax Asset Management | Samsung Electronics vs. URU Metals | Samsung Electronics vs. Wyndham Hotels Resorts |
| Vitec Software vs. Solstad Offshore ASA | Vitec Software vs. Zurich Insurance Group | Vitec Software vs. Nordic Semiconductor ASA | Vitec Software vs. Capital Drilling |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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