Correlation Between Samsung Electronics and Gladstone Investment
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Gladstone Investment 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 Gladstone Investment 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 Gladstone Investment, you can compare the effects of market volatilities on Samsung Electronics and Gladstone Investment 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 Gladstone Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Gladstone Investment.
Diversification Opportunities for Samsung Electronics and Gladstone Investment
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Samsung and Gladstone is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Gladstone Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gladstone Investment 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 Gladstone Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gladstone Investment has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Gladstone Investment go up and down completely randomly.
Pair Corralation between Samsung Electronics and Gladstone Investment
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the Gladstone Investment. In addition to that, Samsung Electronics is 1.14 times more volatile than Gladstone Investment. It trades about -0.06 of its total potential returns per unit of risk. Gladstone Investment is currently generating about 0.04 per unit of volatility. If you would invest 1,163 in Gladstone Investment on November 28, 2024 and sell it today you would earn a total of 129.00 from holding Gladstone Investment or generate 11.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Electronics Co vs. Gladstone Investment
Performance |
| Timeline |
| Samsung Electronics |
| Gladstone Investment |
Samsung Electronics and Gladstone Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and Gladstone Investment
The main advantage of trading using opposite Samsung Electronics and Gladstone Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Gladstone Investment 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 Gladstone Investment will offset losses from the drop in Gladstone Investment's long position.| Samsung Electronics vs. TRAVEL LEISURE DL 01 | Samsung Electronics vs. PLAYSTUDIOS A DL 0001 | Samsung Electronics vs. BIOPHARMA CREDIT DL | Samsung Electronics vs. LG Display Co |
| Gladstone Investment vs. GRUPO CARSO A1 | Gladstone Investment vs. Geely Automobile Holdings | Gladstone Investment vs. PRECISION DRILLING P | Gladstone Investment vs. Major Drilling Group |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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