Correlation Between Samsung Electronics and Slate Office
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Slate Office 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 Slate Office 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 Slate Office REIT, you can compare the effects of market volatilities on Samsung Electronics and Slate Office 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 Slate Office. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Slate Office.
Diversification Opportunities for Samsung Electronics and Slate Office
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Samsung and Slate is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Slate Office REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Slate Office REIT 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 Slate Office. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Slate Office REIT has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Slate Office go up and down completely randomly.
Pair Corralation between Samsung Electronics and Slate Office
Assuming the 90 days horizon Samsung Electronics Co is expected to generate 0.01 times more return on investment than Slate Office. However, Samsung Electronics Co is 92.08 times less risky than Slate Office. It trades about 0.11 of its potential returns per unit of risk. Slate Office REIT is currently generating about 0.0 per unit of risk. If you would invest 3,979 in Samsung Electronics Co on September 3, 2024 and sell it today you would earn a total of 81.00 from holding Samsung Electronics Co or generate 2.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Samsung Electronics Co vs. Slate Office REIT
Performance |
| Timeline |
| Samsung Electronics |
| Slate Office REIT |
Samsung Electronics and Slate Office Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Slate Office
The main advantage of trading using opposite Samsung Electronics and Slate Office positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Slate Office 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 Slate Office will offset losses from the drop in Slate Office's long position.| Samsung Electronics vs. Apple Inc | Samsung Electronics vs. Microsoft | Samsung Electronics vs. Amazon Inc | Samsung Electronics vs. Alphabet Inc Class C |
| Slate Office vs. Franklin Street Properties | Slate Office vs. Douglas Emmett | Slate Office vs. Highwoods Properties | Slate Office vs. Brandywine Realty Trust |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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