Correlation Between Samsung Electronics and Fukuyama Transporting
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Fukuyama Transporting 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 Fukuyama Transporting 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 Fukuyama Transporting Co, you can compare the effects of market volatilities on Samsung Electronics and Fukuyama Transporting 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 Fukuyama Transporting. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Fukuyama Transporting.
Diversification Opportunities for Samsung Electronics and Fukuyama Transporting
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Samsung and Fukuyama is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Fukuyama Transporting Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fukuyama Transporting 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 Fukuyama Transporting. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fukuyama Transporting has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Fukuyama Transporting go up and down completely randomly.
Pair Corralation between Samsung Electronics and Fukuyama Transporting
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the Fukuyama Transporting. But the stock apears to be less risky and, when comparing its historical volatility, Samsung Electronics Co is 1.12 times less risky than Fukuyama Transporting. The stock trades about 0.0 of its potential returns per unit of risk. The Fukuyama Transporting Co is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,751 in Fukuyama Transporting Co on September 2, 2024 and sell it today you would earn a total of 589.00 from holding Fukuyama Transporting Co or generate 33.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. Fukuyama Transporting Co
Performance |
| Timeline |
| Samsung Electronics |
| Fukuyama Transporting |
Samsung Electronics and Fukuyama Transporting Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Fukuyama Transporting
The main advantage of trading using opposite Samsung Electronics and Fukuyama Transporting positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Fukuyama Transporting 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 Fukuyama Transporting will offset losses from the drop in Fukuyama Transporting's long position.| Samsung Electronics vs. PKSHA TECHNOLOGY INC | Samsung Electronics vs. GAMESTOP | Samsung Electronics vs. Zoom Video Communications | Samsung Electronics vs. TSOGO SUN GAMING |
| Fukuyama Transporting vs. Werner Enterprises | Fukuyama Transporting vs. Superior Plus Corp | Fukuyama Transporting vs. NMI Holdings | Fukuyama Transporting vs. Origin Agritech |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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