Correlation Between Samsung Electronics and Swiss Re
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Swiss Re 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 Swiss Re 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 Swiss Re AG, you can compare the effects of market volatilities on Samsung Electronics and Swiss Re 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 Swiss Re. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Swiss Re.
Diversification Opportunities for Samsung Electronics and Swiss Re
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Samsung and Swiss is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Swiss Re AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Swiss Re AG 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 Swiss Re. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Swiss Re AG has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Swiss Re go up and down completely randomly.
Pair Corralation between Samsung Electronics and Swiss Re
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the Swiss Re. In addition to that, Samsung Electronics is 1.12 times more volatile than Swiss Re AG. It trades about -0.02 of its total potential returns per unit of risk. Swiss Re AG is currently generating about 0.08 per unit of volatility. If you would invest 2,104 in Swiss Re AG on November 5, 2024 and sell it today you would earn a total of 1,616 from holding Swiss Re AG or generate 76.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Samsung Electronics Co vs. Swiss Re AG
Performance |
| Timeline |
| Samsung Electronics |
| Swiss Re AG |
Samsung Electronics and Swiss Re Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Swiss Re
The main advantage of trading using opposite Samsung Electronics and Swiss Re positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Swiss Re 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 Swiss Re will offset losses from the drop in Swiss Re's long position.| Samsung Electronics vs. ANTA SPORTS PRODUCT | Samsung Electronics vs. SQUIRREL MEDIA SA | Samsung Electronics vs. British American Tobacco | Samsung Electronics vs. Universal Entertainment |
| Swiss Re vs. DAIDO METAL TD | Swiss Re vs. GREENX METALS LTD | Swiss Re vs. AEON METALS LTD | Swiss Re vs. Singapore Telecommunications Limited |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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