Correlation Between Samsung Electronics and American Virtual
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and American Virtual 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 American Virtual 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 American Virtual Cloud, you can compare the effects of market volatilities on Samsung Electronics and American Virtual 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 American Virtual. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and American Virtual.
Diversification Opportunities for Samsung Electronics and American Virtual
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Samsung and American is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and American Virtual Cloud in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Virtual Cloud 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 American Virtual. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Virtual Cloud has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and American Virtual go up and down completely randomly.
Pair Corralation between Samsung Electronics and American Virtual
Assuming the 90 days horizon Samsung Electronics is expected to generate 1800.49 times less return on investment than American Virtual. But when comparing it to its historical volatility, Samsung Electronics Co is 1184.24 times less risky than American Virtual. It trades about 0.1 of its potential returns per unit of risk. American Virtual Cloud is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 8.01 in American Virtual Cloud on September 12, 2024 and sell it today you would lose (7.41) from holding American Virtual Cloud or give up 92.51% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 21.66% |
| Values | Daily Returns |
Samsung Electronics Co vs. American Virtual Cloud
Performance |
| Timeline |
| Samsung Electronics |
| American Virtual Cloud |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Samsung Electronics and American Virtual Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and American Virtual
The main advantage of trading using opposite Samsung Electronics and American Virtual positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, American Virtual 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 American Virtual will offset losses from the drop in American Virtual's long position.| Samsung Electronics vs. Copa Holdings SA | Samsung Electronics vs. United Airlines Holdings | Samsung Electronics vs. Delta Air Lines | Samsung Electronics vs. SkyWest |
| American Virtual vs. Harmony Gold Mining | American Virtual vs. Toro Co | American Virtual vs. Vera Bradley | American Virtual vs. Paiute Oil Mining |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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