Correlation Between Samsung Electronics and Disney
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Disney 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 Disney 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 The Walt Disney, you can compare the effects of market volatilities on Samsung Electronics and Disney 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 Disney. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Disney.
Diversification Opportunities for Samsung Electronics and Disney
-0.79 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Samsung and Disney is -0.79. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and The Walt Disney in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Walt Disney 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 Disney. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Walt Disney has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Disney go up and down completely randomly.
Pair Corralation between Samsung Electronics and Disney
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the Disney. In addition to that, Samsung Electronics is 1.14 times more volatile than The Walt Disney. It trades about -0.13 of its total potential returns per unit of risk. The Walt Disney is currently generating about 0.45 per unit of volatility. If you would invest 192,691 in The Walt Disney on September 1, 2024 and sell it today you would earn a total of 45,209 from holding The Walt Disney or generate 23.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Samsung Electronics Co vs. The Walt Disney
Performance |
| Timeline |
| Samsung Electronics |
| Walt Disney |
Samsung Electronics and Disney Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Disney
The main advantage of trading using opposite Samsung Electronics and Disney positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Disney 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 Disney will offset losses from the drop in Disney's long position.| Samsung Electronics vs. Apple Inc | Samsung Electronics vs. Netflix | Samsung Electronics vs. Monster Beverage Corp |
| Disney vs. Grupo Sports World | Disney vs. Delta Air Lines | Disney vs. FibraHotel | Disney vs. Costco Wholesale |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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