Correlation Between Samsung Electronics and Bunzl PLC
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Bunzl 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 Bunzl 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 Bunzl PLC, you can compare the effects of market volatilities on Samsung Electronics and Bunzl 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 Bunzl PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Bunzl PLC.
Diversification Opportunities for Samsung Electronics and Bunzl PLC
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Samsung and Bunzl is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Bunzl PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bunzl 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 Bunzl PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bunzl PLC has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Bunzl PLC go up and down completely randomly.
Pair Corralation between Samsung Electronics and Bunzl PLC
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the Bunzl PLC. In addition to that, Samsung Electronics is 1.8 times more volatile than Bunzl PLC. It trades about 0.0 of its total potential returns per unit of risk. Bunzl PLC is currently generating about 0.04 per unit of volatility. If you would invest 288,408 in Bunzl PLC on September 1, 2024 and sell it today you would earn a total of 65,192 from holding Bunzl PLC or generate 22.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Samsung Electronics Co vs. Bunzl PLC
Performance |
| Timeline |
| Samsung Electronics |
| Bunzl PLC |
Samsung Electronics and Bunzl PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Bunzl PLC
The main advantage of trading using opposite Samsung Electronics and Bunzl PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Bunzl 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 Bunzl PLC will offset losses from the drop in Bunzl PLC's long position.| Samsung Electronics vs. Ecclesiastical Insurance Office | Samsung Electronics vs. FC Investment Trust | Samsung Electronics vs. New Residential Investment | Samsung Electronics vs. DFS Furniture PLC |
| Bunzl PLC vs. Samsung Electronics Co | Bunzl PLC vs. Samsung Electronics Co | Bunzl PLC vs. Hyundai Motor | Bunzl PLC vs. Toyota Motor Corp |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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