Correlation Between Samsung Electronics and Liontrust Asset
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Liontrust Asset 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 Liontrust Asset 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 Liontrust Asset Management, you can compare the effects of market volatilities on Samsung Electronics and Liontrust Asset 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 Liontrust Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Liontrust Asset.
Diversification Opportunities for Samsung Electronics and Liontrust Asset
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Samsung and Liontrust is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Liontrust Asset Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Liontrust Asset Mana 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 Liontrust Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Liontrust Asset Mana has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Liontrust Asset go up and down completely randomly.
Pair Corralation between Samsung Electronics and Liontrust Asset
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the Liontrust Asset. But the stock apears to be less risky and, when comparing its historical volatility, Samsung Electronics Co is 1.31 times less risky than Liontrust Asset. The stock trades about -0.04 of its potential returns per unit of risk. The Liontrust Asset Management is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 62,417 in Liontrust Asset Management on September 2, 2024 and sell it today you would lose (18,667) from holding Liontrust Asset Management or give up 29.91% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. Liontrust Asset Management
Performance |
| Timeline |
| Samsung Electronics |
| Liontrust Asset Mana |
Samsung Electronics and Liontrust Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Liontrust Asset
The main advantage of trading using opposite Samsung Electronics and Liontrust Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Liontrust Asset 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 Liontrust Asset will offset losses from the drop in Liontrust Asset's long position.| Samsung Electronics vs. Cizzle Biotechnology Holdings | Samsung Electronics vs. International Biotechnology Trust | Samsung Electronics vs. TechnipFMC PLC | Samsung Electronics vs. Intuitive Investments Group |
| Liontrust Asset vs. Liberty Media Corp | Liontrust Asset vs. Cars Inc | Liontrust Asset vs. Universal Display Corp | Liontrust Asset vs. Flutter Entertainment PLC |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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