Correlation Between Samsung Electronics and UET United
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and UET United 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 UET United 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 UET United Electronic, you can compare the effects of market volatilities on Samsung Electronics and UET United 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 UET United. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and UET United.
Diversification Opportunities for Samsung Electronics and UET United
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Samsung and UET is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and UET United Electronic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on UET United Electronic 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 UET United. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of UET United Electronic has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and UET United go up and down completely randomly.
Pair Corralation between Samsung Electronics and UET United
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the UET United. But the stock apears to be less risky and, when comparing its historical volatility, Samsung Electronics Co is 2.72 times less risky than UET United. The stock trades about -0.05 of its potential returns per unit of risk. The UET United Electronic is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 82.00 in UET United Electronic on November 18, 2024 and sell it today you would earn a total of 7.00 from holding UET United Electronic or generate 8.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. UET United Electronic
Performance |
| Timeline |
| Samsung Electronics |
| UET United Electronic |
Samsung Electronics and UET United Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and UET United
The main advantage of trading using opposite Samsung Electronics and UET United positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, UET United 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 UET United will offset losses from the drop in UET United'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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