Correlation Between Samsung Electronics and Genertec Universal
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Genertec Universal 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 Genertec Universal 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 Genertec Universal Medical, you can compare the effects of market volatilities on Samsung Electronics and Genertec Universal 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 Genertec Universal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Genertec Universal.
Diversification Opportunities for Samsung Electronics and Genertec Universal
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Samsung and Genertec is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Genertec Universal Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genertec Universal 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 Genertec Universal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genertec Universal has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Genertec Universal go up and down completely randomly.
Pair Corralation between Samsung Electronics and Genertec Universal
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the Genertec Universal. But the stock apears to be less risky and, when comparing its historical volatility, Samsung Electronics Co is 1.7 times less risky than Genertec Universal. The stock trades about -0.02 of its potential returns per unit of risk. The Genertec Universal Medical is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 57.00 in Genertec Universal Medical on October 12, 2024 and sell it today you would earn a total of 0.00 from holding Genertec Universal Medical or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. Genertec Universal Medical
Performance |
| Timeline |
| Samsung Electronics |
| Genertec Universal |
Samsung Electronics and Genertec Universal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Genertec Universal
The main advantage of trading using opposite Samsung Electronics and Genertec Universal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Genertec Universal 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 Genertec Universal will offset losses from the drop in Genertec Universal's long position.| Samsung Electronics vs. Samsung Electronics Co | Samsung Electronics vs. Microsoft | Samsung Electronics vs. Tencent Holdings |
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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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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