Correlation Between Samsung Electronics and Hawesko Holding
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Hawesko Holding 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 Hawesko Holding 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 Hawesko Holding AG, you can compare the effects of market volatilities on Samsung Electronics and Hawesko Holding 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 Hawesko Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Hawesko Holding.
Diversification Opportunities for Samsung Electronics and Hawesko Holding
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Samsung and Hawesko is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Hawesko Holding AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hawesko Holding 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 Hawesko Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hawesko Holding AG has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Hawesko Holding go up and down completely randomly.
Pair Corralation between Samsung Electronics and Hawesko Holding
Assuming the 90 days trading horizon Samsung Electronics Co is expected to generate 0.91 times more return on investment than Hawesko Holding. However, Samsung Electronics Co is 1.1 times less risky than Hawesko Holding. It trades about -0.01 of its potential returns per unit of risk. Hawesko Holding AG is currently generating about -0.04 per unit of risk. If you would invest 91,536 in Samsung Electronics Co on September 12, 2024 and sell it today you would lose (16,736) from holding Samsung Electronics Co or give up 18.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. Hawesko Holding AG
Performance |
| Timeline |
| Samsung Electronics |
| Hawesko Holding AG |
Samsung Electronics and Hawesko Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Hawesko Holding
The main advantage of trading using opposite Samsung Electronics and Hawesko Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Hawesko Holding 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 Hawesko Holding will offset losses from the drop in Hawesko Holding's long position.| Samsung Electronics vs. Samsung Electronics Co | Samsung Electronics vs. Sony Group | Samsung Electronics vs. Superior Plus Corp | Samsung Electronics vs. SIVERS SEMICONDUCTORS AB |
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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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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