Correlation Between Samsung Electronics and Austevoll Seafood
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Austevoll Seafood 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 Austevoll Seafood 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 Austevoll Seafood ASA, you can compare the effects of market volatilities on Samsung Electronics and Austevoll Seafood 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 Austevoll Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Austevoll Seafood.
Diversification Opportunities for Samsung Electronics and Austevoll Seafood
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Samsung and Austevoll is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Austevoll Seafood ASA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Austevoll Seafood ASA 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 Austevoll Seafood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Austevoll Seafood ASA has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Austevoll Seafood go up and down completely randomly.
Pair Corralation between Samsung Electronics and Austevoll Seafood
Assuming the 90 days trading horizon Samsung Electronics Co is expected to generate 1.08 times more return on investment than Austevoll Seafood. However, Samsung Electronics is 1.08 times more volatile than Austevoll Seafood ASA. It trades about -0.06 of its potential returns per unit of risk. Austevoll Seafood ASA is currently generating about -0.11 per unit of risk. If you would invest 76,000 in Samsung Electronics Co on October 16, 2024 and sell it today you would lose (2,000) from holding Samsung Electronics Co or give up 2.63% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 94.12% |
| Values | Daily Returns |
Samsung Electronics Co vs. Austevoll Seafood ASA
Performance |
| Timeline |
| Samsung Electronics |
| Austevoll Seafood ASA |
Samsung Electronics and Austevoll Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Austevoll Seafood
The main advantage of trading using opposite Samsung Electronics and Austevoll Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Austevoll Seafood 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 Austevoll Seafood will offset losses from the drop in Austevoll Seafood'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 Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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