Correlation Between Samsung Electronics and MCAN Mortgage
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and MCAN Mortgage 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 MCAN Mortgage 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 MCAN Mortgage, you can compare the effects of market volatilities on Samsung Electronics and MCAN Mortgage 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 MCAN Mortgage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and MCAN Mortgage.
Diversification Opportunities for Samsung Electronics and MCAN Mortgage
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Samsung and MCAN is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and MCAN Mortgage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MCAN Mortgage 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 MCAN Mortgage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MCAN Mortgage has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and MCAN Mortgage go up and down completely randomly.
Pair Corralation between Samsung Electronics and MCAN Mortgage
Assuming the 90 days horizon Samsung Electronics is expected to generate 25.9 times less return on investment than MCAN Mortgage. But when comparing it to its historical volatility, Samsung Electronics Co is 14.94 times less risky than MCAN Mortgage. It trades about 0.11 of its potential returns per unit of risk. MCAN Mortgage is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 1,024 in MCAN Mortgage on September 3, 2024 and sell it today you would earn a total of 371.00 from holding MCAN Mortgage or generate 36.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 46.13% |
| Values | Daily Returns |
Samsung Electronics Co vs. MCAN Mortgage
Performance |
| Timeline |
| Samsung Electronics |
| MCAN Mortgage |
Samsung Electronics and MCAN Mortgage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and MCAN Mortgage
The main advantage of trading using opposite Samsung Electronics and MCAN Mortgage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, MCAN Mortgage 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 MCAN Mortgage will offset losses from the drop in MCAN Mortgage's long position.| Samsung Electronics vs. Apple Inc | Samsung Electronics vs. Microsoft | Samsung Electronics vs. Amazon Inc | Samsung Electronics vs. Alphabet Inc Class C |
| MCAN Mortgage vs. Guild Holdings Co | MCAN Mortgage vs. Mr Cooper Group | MCAN Mortgage vs. Encore Capital Group | MCAN Mortgage vs. CNFinance Holdings |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
Other Complementary Tools
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Stocks Directory Find actively traded stocks across global markets | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories |