Correlation Between Samsung Electronics and T.J. Maxx
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and T.J. Maxx 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 T.J. Maxx 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 The TJX Companies, you can compare the effects of market volatilities on Samsung Electronics and T.J. Maxx 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 T.J. Maxx. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and T.J. Maxx.
Diversification Opportunities for Samsung Electronics and T.J. Maxx
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Samsung and T.J. is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and The TJX Companies in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TJX Companies 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 T.J. Maxx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TJX Companies has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and T.J. Maxx go up and down completely randomly.
Pair Corralation between Samsung Electronics and T.J. Maxx
Assuming the 90 days horizon Samsung Electronics is expected to generate 5.0 times less return on investment than T.J. Maxx. In addition to that, Samsung Electronics is 1.85 times more volatile than The TJX Companies. It trades about 0.03 of its total potential returns per unit of risk. The TJX Companies is currently generating about 0.28 per unit of volatility. If you would invest 10,561 in The TJX Companies on August 26, 2024 and sell it today you would earn a total of 1,029 from holding The TJX Companies or generate 9.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. The TJX Companies
Performance |
| Timeline |
| Samsung Electronics |
| TJX Companies |
Samsung Electronics and T.J. Maxx Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and T.J. Maxx
The main advantage of trading using opposite Samsung Electronics and T.J. Maxx positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, T.J. Maxx 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 T.J. Maxx will offset losses from the drop in T.J. Maxx's long position.| Samsung Electronics vs. Amazon Inc | Samsung Electronics vs. Microsoft | Samsung Electronics vs. Tesla Inc | Samsung Electronics vs. Alphabet Class A |
| T.J. Maxx vs. Titan Machinery | T.J. Maxx vs. Tower Semiconductor | T.J. Maxx vs. Hitachi Construction Machinery | T.J. Maxx vs. Elmos Semiconductor SE |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |