Correlation Between Samsung Electronics and Telecom Argentina
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Telecom Argentina 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 Telecom Argentina 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 Telecom Argentina SA, you can compare the effects of market volatilities on Samsung Electronics and Telecom Argentina 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 Telecom Argentina. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Telecom Argentina.
Diversification Opportunities for Samsung Electronics and Telecom Argentina
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Samsung and Telecom is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Telecom Argentina SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Telecom Argentina 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 Telecom Argentina. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Telecom Argentina has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Telecom Argentina go up and down completely randomly.
Pair Corralation between Samsung Electronics and Telecom Argentina
Assuming the 90 days trading horizon Samsung Electronics is expected to generate 2.49 times less return on investment than Telecom Argentina. But when comparing it to its historical volatility, Samsung Electronics Co is 1.58 times less risky than Telecom Argentina. It trades about 0.07 of its potential returns per unit of risk. Telecom Argentina SA is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,320 in Telecom Argentina SA on October 11, 2024 and sell it today you would earn a total of 80.00 from holding Telecom Argentina SA or generate 6.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. Telecom Argentina SA
Performance |
| Timeline |
| Samsung Electronics |
| Telecom Argentina |
Samsung Electronics and Telecom Argentina Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Telecom Argentina
The main advantage of trading using opposite Samsung Electronics and Telecom Argentina positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Telecom Argentina 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 Telecom Argentina will offset losses from the drop in Telecom Argentina's long position.| Samsung Electronics vs. Samsung Electronics Co | Samsung Electronics vs. Microsoft | Samsung Electronics vs. Tencent Holdings |
| Telecom Argentina vs. Apollo Investment Corp | Telecom Argentina vs. Gladstone Investment | Telecom Argentina vs. SINGAPORE AIRLINES | Telecom Argentina vs. Nok Airlines PCL |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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