Correlation Between Samsung Electronics and ASPEN PHARUNADR
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and ASPEN PHARUNADR 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 ASPEN PHARUNADR 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 ASPEN PHARUNADR 1, you can compare the effects of market volatilities on Samsung Electronics and ASPEN PHARUNADR 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 ASPEN PHARUNADR. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and ASPEN PHARUNADR.
Diversification Opportunities for Samsung Electronics and ASPEN PHARUNADR
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Samsung and ASPEN is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and ASPEN PHARUNADR 1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASPEN PHARUNADR 1 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 ASPEN PHARUNADR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASPEN PHARUNADR 1 has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and ASPEN PHARUNADR go up and down completely randomly.
Pair Corralation between Samsung Electronics and ASPEN PHARUNADR
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the ASPEN PHARUNADR. But the stock apears to be less risky and, when comparing its historical volatility, Samsung Electronics Co is 1.14 times less risky than ASPEN PHARUNADR. The stock trades about -0.02 of its potential returns per unit of risk. The ASPEN PHARUNADR 1 is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 717.00 in ASPEN PHARUNADR 1 on October 27, 2024 and sell it today you would earn a total of 153.00 from holding ASPEN PHARUNADR 1 or generate 21.34% 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. ASPEN PHARUNADR 1
Performance |
| Timeline |
| Samsung Electronics |
| ASPEN PHARUNADR 1 |
Samsung Electronics and ASPEN PHARUNADR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and ASPEN PHARUNADR
The main advantage of trading using opposite Samsung Electronics and ASPEN PHARUNADR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, ASPEN PHARUNADR 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 ASPEN PHARUNADR will offset losses from the drop in ASPEN PHARUNADR's long position.| Samsung Electronics vs. Apple Inc | Samsung Electronics vs. Apple Inc | Samsung Electronics vs. Samsung Electronics Co | Samsung Electronics vs. Sony Group Corp |
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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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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