Correlation Between Samsung Electronics and Grupo Sports
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Grupo Sports 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 Grupo Sports 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 Grupo Sports World, you can compare the effects of market volatilities on Samsung Electronics and Grupo Sports 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 Grupo Sports. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Grupo Sports.
Diversification Opportunities for Samsung Electronics and Grupo Sports
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Samsung and Grupo is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Grupo Sports World in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grupo Sports World 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 Grupo Sports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grupo Sports World has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Grupo Sports go up and down completely randomly.
Pair Corralation between Samsung Electronics and Grupo Sports
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the Grupo Sports. But the stock apears to be less risky and, when comparing its historical volatility, Samsung Electronics Co is 1.11 times less risky than Grupo Sports. The stock trades about -0.16 of its potential returns per unit of risk. The Grupo Sports World is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 530.00 in Grupo Sports World on November 1, 2024 and sell it today you would earn a total of 95.00 from holding Grupo Sports World or generate 17.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. Grupo Sports World
Performance |
| Timeline |
| Samsung Electronics |
| Grupo Sports World |
Samsung Electronics and Grupo Sports Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Grupo Sports
The main advantage of trading using opposite Samsung Electronics and Grupo Sports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Grupo Sports 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 Grupo Sports will offset losses from the drop in Grupo Sports' long position.| Samsung Electronics vs. Grupo Carso SAB | Samsung Electronics vs. KB Home | Samsung Electronics vs. Cognizant Technology Solutions | Samsung Electronics vs. FIBRA Storage |
| Grupo Sports vs. United Airlines Holdings | Grupo Sports vs. FibraHotel | Grupo Sports vs. Micron Technology | Grupo Sports vs. FIBRA Storage |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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