Correlation Between Samsung Electronics and Newport Exploration
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Newport Exploration 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 Newport Exploration 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 Newport Exploration, you can compare the effects of market volatilities on Samsung Electronics and Newport Exploration 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 Newport Exploration. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Newport Exploration.
Diversification Opportunities for Samsung Electronics and Newport Exploration
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Samsung and Newport is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Newport Exploration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Newport Exploration 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 Newport Exploration. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Newport Exploration has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Newport Exploration go up and down completely randomly.
Pair Corralation between Samsung Electronics and Newport Exploration
If you would invest 5.95 in Newport Exploration on September 2, 2024 and sell it today you would earn a total of 0.27 from holding Newport Exploration or generate 4.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Samsung Electronics Co vs. Newport Exploration
Performance |
| Timeline |
| Samsung Electronics |
| Newport Exploration |
Samsung Electronics and Newport Exploration Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Newport Exploration
The main advantage of trading using opposite Samsung Electronics and Newport Exploration positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Newport Exploration 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 Newport Exploration will offset losses from the drop in Newport Exploration's long position.| Samsung Electronics vs. Legacy Education | Samsung Electronics vs. Apple Inc | Samsung Electronics vs. NVIDIA | Samsung Electronics vs. Microsoft |
| Newport Exploration vs. Traction Uranium Corp | Newport Exploration vs. New Age Metals | Newport Exploration vs. York Harbour Metals | Newport Exploration vs. Silver Elephant 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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