Correlation Between Samsung Electronics and Vector
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Vector 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 Vector 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 Vector Group, you can compare the effects of market volatilities on Samsung Electronics and Vector 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 Vector. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Vector.
Diversification Opportunities for Samsung Electronics and Vector
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Samsung and Vector is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Vector Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vector Group 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 Vector. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vector Group has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Vector go up and down completely randomly.
Pair Corralation between Samsung Electronics and Vector
If you would invest 1,499 in Vector Group on August 31, 2024 and sell it today you would earn a total of 0.00 from holding Vector Group or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 4.55% |
| Values | Daily Returns |
Samsung Electronics Co vs. Vector Group
Performance |
| Timeline |
| Samsung Electronics |
| Vector Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Samsung Electronics and Vector Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Vector
The main advantage of trading using opposite Samsung Electronics and Vector positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Vector 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 Vector will offset losses from the drop in Vector's long position.| Samsung Electronics vs. Legacy Education | Samsung Electronics vs. Apple Inc | Samsung Electronics vs. NVIDIA | Samsung Electronics vs. Microsoft |
| Vector vs. Universal | Vector vs. Imperial Brands PLC | Vector vs. Japan Tobacco ADR | Vector vs. Philip Morris International |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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