Correlation Between Samsung Electronics and State Bank
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and State Bank 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 State Bank 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 State Bank of, you can compare the effects of market volatilities on Samsung Electronics and State Bank 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 State Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and State Bank.
Diversification Opportunities for Samsung Electronics and State Bank
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Samsung and State is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and State Bank of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on State Bank 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 State Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of State Bank has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and State Bank go up and down completely randomly.
Pair Corralation between Samsung Electronics and State Bank
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the State Bank. In addition to that, Samsung Electronics is 1.6 times more volatile than State Bank of. It trades about -0.02 of its total potential returns per unit of risk. State Bank of is currently generating about 0.14 per unit of volatility. If you would invest 9,400 in State Bank of on August 28, 2024 and sell it today you would earn a total of 560.00 from holding State Bank of or generate 5.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. State Bank of
Performance |
| Timeline |
| Samsung Electronics |
| State Bank |
Samsung Electronics and State Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and State Bank
The main advantage of trading using opposite Samsung Electronics and State Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, State Bank 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 State Bank will offset losses from the drop in State Bank's long position.| Samsung Electronics vs. Cornish Metals | Samsung Electronics vs. Gaztransport et Technigaz | Samsung Electronics vs. Blackstone Loan Financing | Samsung Electronics vs. CAP LEASE AVIATION |
| State Bank vs. Abingdon Health Plc | State Bank vs. Lords Grp Trading | State Bank vs. The Mercantile Investment | State Bank vs. Naturhouse Health SA |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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