Correlation Between Samsung Electronics and Alternative Investment
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Alternative Investment 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 Alternative Investment 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 Alternative Investment, you can compare the effects of market volatilities on Samsung Electronics and Alternative Investment 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 Alternative Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Alternative Investment.
Diversification Opportunities for Samsung Electronics and Alternative Investment
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Samsung and Alternative is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Alternative Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Alternative Investment 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 Alternative Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Alternative Investment has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Alternative Investment go up and down completely randomly.
Pair Corralation between Samsung Electronics and Alternative Investment
Assuming the 90 days horizon Samsung Electronics is expected to generate 287.0 times less return on investment than Alternative Investment. But when comparing it to its historical volatility, Samsung Electronics Co is 665.29 times less risky than Alternative Investment. It trades about 0.1 of its potential returns per unit of risk. Alternative Investment is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 0.01 in Alternative Investment on August 30, 2024 and sell it today you would earn a total of 187.99 from holding Alternative Investment or generate 1879900.0% 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. Alternative Investment
Performance |
| Timeline |
| Samsung Electronics |
| Alternative Investment |
Samsung Electronics and Alternative Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Alternative Investment
The main advantage of trading using opposite Samsung Electronics and Alternative Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Alternative Investment 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 Alternative Investment will offset losses from the drop in Alternative Investment's long position.| Samsung Electronics vs. Universal Electronics | Samsung Electronics vs. Vizio Holding Corp | Samsung Electronics vs. VOXX International | Samsung Electronics vs. Sony Group Corp |
| Alternative Investment vs. BBB Foods | Alternative Investment vs. Eldorado Gold Corp | Alternative Investment vs. Tradeweb Markets | Alternative Investment vs. Enersys |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital |