Correlation Between Samsung Electronics and CLP Holdings
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and CLP Holdings 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 CLP Holdings 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 CLP Holdings, you can compare the effects of market volatilities on Samsung Electronics and CLP Holdings 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 CLP Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and CLP Holdings.
Diversification Opportunities for Samsung Electronics and CLP Holdings
-0.81 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Samsung and CLP is -0.81. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and CLP Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CLP Holdings 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 CLP Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CLP Holdings has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and CLP Holdings go up and down completely randomly.
Pair Corralation between Samsung Electronics and CLP Holdings
Assuming the 90 days horizon Samsung Electronics is expected to generate 5.04 times less return on investment than CLP Holdings. But when comparing it to its historical volatility, Samsung Electronics Co is 15.03 times less risky than CLP Holdings. It trades about 0.13 of its potential returns per unit of risk. CLP Holdings is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 793.00 in CLP Holdings on August 29, 2024 and sell it today you would earn a total of 46.00 from holding CLP Holdings or generate 5.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. CLP Holdings
Performance |
| Timeline |
| Samsung Electronics |
| CLP Holdings |
Samsung Electronics and CLP Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and CLP Holdings
The main advantage of trading using opposite Samsung Electronics and CLP Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, CLP Holdings 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 CLP Holdings will offset losses from the drop in CLP Holdings' long position.| Samsung Electronics vs. Copa Holdings SA | Samsung Electronics vs. United Airlines Holdings | Samsung Electronics vs. Delta Air Lines | Samsung Electronics vs. SkyWest |
| CLP Holdings vs. Hong Kong and | CLP Holdings vs. Power Assets Holdings | CLP Holdings vs. Swire Pacific | CLP Holdings vs. Sun Hung Kai |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments |