Correlation Between Samsung Electronics and PATTIES FOODS
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and PATTIES FOODS 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 PATTIES FOODS 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 PATTIES FOODS , you can compare the effects of market volatilities on Samsung Electronics and PATTIES FOODS 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 PATTIES FOODS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and PATTIES FOODS.
Diversification Opportunities for Samsung Electronics and PATTIES FOODS
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Samsung and PATTIES is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and PATTIES FOODS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PATTIES FOODS 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 PATTIES FOODS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PATTIES FOODS has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and PATTIES FOODS go up and down completely randomly.
Pair Corralation between Samsung Electronics and PATTIES FOODS
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the PATTIES FOODS. But the stock apears to be less risky and, when comparing its historical volatility, Samsung Electronics Co is 3.33 times less risky than PATTIES FOODS. The stock trades about 0.0 of its potential returns per unit of risk. The PATTIES FOODS is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 27.00 in PATTIES FOODS on October 24, 2024 and sell it today you would earn a total of 1.00 from holding PATTIES FOODS or generate 3.7% 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. PATTIES FOODS
Performance |
| Timeline |
| Samsung Electronics |
| PATTIES FOODS |
Samsung Electronics and PATTIES FOODS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Electronics and PATTIES FOODS
The main advantage of trading using opposite Samsung Electronics and PATTIES FOODS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, PATTIES FOODS 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 PATTIES FOODS will offset losses from the drop in PATTIES FOODS's long position.| Samsung Electronics vs. Apple Inc | Samsung Electronics vs. Apple Inc | Samsung Electronics vs. Apple Inc | Samsung Electronics vs. Apple Inc |
| PATTIES FOODS vs. Zoetis Inc | PATTIES FOODS vs. Takeda Pharmaceutical | PATTIES FOODS vs. Eisai Co | PATTIES FOODS vs. Shionogi Co |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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