Correlation Between Samsung Electronics and FAIR ISAAC
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and FAIR ISAAC 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 FAIR ISAAC 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 FAIR ISAAC, you can compare the effects of market volatilities on Samsung Electronics and FAIR ISAAC 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 FAIR ISAAC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and FAIR ISAAC.
Diversification Opportunities for Samsung Electronics and FAIR ISAAC
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Samsung and FAIR is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and FAIR ISAAC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FAIR ISAAC 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 FAIR ISAAC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FAIR ISAAC has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and FAIR ISAAC go up and down completely randomly.
Pair Corralation between Samsung Electronics and FAIR ISAAC
Assuming the 90 days horizon Samsung Electronics Co is expected to generate 0.91 times more return on investment than FAIR ISAAC. However, Samsung Electronics Co is 1.1 times less risky than FAIR ISAAC. It trades about 0.02 of its potential returns per unit of risk. FAIR ISAAC is currently generating about -0.13 per unit of risk. If you would invest 86,800 in Samsung Electronics Co on November 3, 2024 and sell it today you would earn a total of 600.00 from holding Samsung Electronics Co or generate 0.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. FAIR ISAAC
Performance |
| Timeline |
| Samsung Electronics |
| FAIR ISAAC |
Samsung Electronics and FAIR ISAAC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and FAIR ISAAC
The main advantage of trading using opposite Samsung Electronics and FAIR ISAAC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, FAIR ISAAC 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 FAIR ISAAC will offset losses from the drop in FAIR ISAAC's long position.| Samsung Electronics vs. MTY Food Group | Samsung Electronics vs. Mobilezone Holding AG | Samsung Electronics vs. Zoom Video Communications | Samsung Electronics vs. WillScot Mobile Mini |
| FAIR ISAAC vs. ANTA SPORTS PRODUCT | FAIR ISAAC vs. PLAYMATES TOYS | FAIR ISAAC vs. ARISTOCRAT LEISURE | FAIR ISAAC vs. MTY Food Group |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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