Correlation Between Samsung Electronics and Barclays PLC
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Barclays PLC 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 Barclays PLC 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 Barclays PLC, you can compare the effects of market volatilities on Samsung Electronics and Barclays PLC 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 Barclays PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Barclays PLC.
Diversification Opportunities for Samsung Electronics and Barclays PLC
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Samsung and Barclays is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Barclays PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barclays PLC 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 Barclays PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barclays PLC has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Barclays PLC go up and down completely randomly.
Pair Corralation between Samsung Electronics and Barclays PLC
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the Barclays PLC. In addition to that, Samsung Electronics is 1.33 times more volatile than Barclays PLC. It trades about -0.2 of its total potential returns per unit of risk. Barclays PLC is currently generating about 0.14 per unit of volatility. If you would invest 22,840 in Barclays PLC on August 30, 2024 and sell it today you would earn a total of 3,670 from holding Barclays PLC or generate 16.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. Barclays PLC
Performance |
| Timeline |
| Samsung Electronics |
| Barclays PLC |
Samsung Electronics and Barclays PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Barclays PLC
The main advantage of trading using opposite Samsung Electronics and Barclays PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Barclays PLC 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 Barclays PLC will offset losses from the drop in Barclays PLC's long position.| Samsung Electronics vs. The Investment | Samsung Electronics vs. Kinnevik Investment AB | Samsung Electronics vs. The Mercantile Investment | Samsung Electronics vs. Smithson Investment Trust |
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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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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