Correlation Between Samsung Electronics and Bio-Techne Corp
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Bio-Techne Corp 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 Bio-Techne Corp 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 Bio Techne Corp, you can compare the effects of market volatilities on Samsung Electronics and Bio-Techne Corp 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 Bio-Techne Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Bio-Techne Corp.
Diversification Opportunities for Samsung Electronics and Bio-Techne Corp
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Samsung and Bio-Techne is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Bio Techne Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bio Techne Corp 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 Bio-Techne Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bio Techne Corp has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Bio-Techne Corp go up and down completely randomly.
Pair Corralation between Samsung Electronics and Bio-Techne Corp
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the Bio-Techne Corp. In addition to that, Samsung Electronics is 1.11 times more volatile than Bio Techne Corp. It trades about -0.1 of its total potential returns per unit of risk. Bio Techne Corp is currently generating about 0.06 per unit of volatility. If you would invest 6,900 in Bio Techne Corp on November 3, 2024 and sell it today you would earn a total of 150.00 from holding Bio Techne Corp or generate 2.17% 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. Bio Techne Corp
Performance |
| Timeline |
| Samsung Electronics |
| Bio Techne Corp |
Samsung Electronics and Bio-Techne Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Bio-Techne Corp
The main advantage of trading using opposite Samsung Electronics and Bio-Techne Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Bio-Techne Corp 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 Bio-Techne Corp will offset losses from the drop in Bio-Techne Corp'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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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