Correlation Between Samsung Electronics and ScanSource
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and ScanSource 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 ScanSource 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 ScanSource, you can compare the effects of market volatilities on Samsung Electronics and ScanSource 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 ScanSource. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and ScanSource.
Diversification Opportunities for Samsung Electronics and ScanSource
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Samsung and ScanSource is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and ScanSource in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ScanSource 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 ScanSource. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ScanSource has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and ScanSource go up and down completely randomly.
Pair Corralation between Samsung Electronics and ScanSource
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the ScanSource. In addition to that, Samsung Electronics is 1.36 times more volatile than ScanSource. It trades about -0.03 of its total potential returns per unit of risk. ScanSource is currently generating about 0.12 per unit of volatility. If you would invest 4,520 in ScanSource on October 30, 2024 and sell it today you would earn a total of 160.00 from holding ScanSource or generate 3.54% 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. ScanSource
Performance |
| Timeline |
| Samsung Electronics |
| ScanSource |
Samsung Electronics and ScanSource Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and ScanSource
The main advantage of trading using opposite Samsung Electronics and ScanSource positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, ScanSource 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 ScanSource will offset losses from the drop in ScanSource'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 |
| ScanSource vs. MAGNUM MINING EXP | ScanSource vs. ARDAGH METAL PACDL 0001 | ScanSource vs. Perseus Mining Limited | ScanSource vs. SILICON LABORATOR |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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