Correlation Between Triad Group and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both Triad Group and Samsung Electronics 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 Triad Group and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Triad Group PLC and Samsung Electronics Co, you can compare the effects of market volatilities on Triad Group and Samsung Electronics 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 Triad Group with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Triad Group and Samsung Electronics.
Diversification Opportunities for Triad Group and Samsung Electronics
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Triad and Samsung is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding Triad Group PLC and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and Triad Group 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 Triad Group PLC are associated (or correlated) with Samsung Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samsung Electronics has no effect on the direction of Triad Group i.e., Triad Group and Samsung Electronics go up and down completely randomly.
Pair Corralation between Triad Group and Samsung Electronics
Assuming the 90 days trading horizon Triad Group PLC is expected to generate 1.29 times more return on investment than Samsung Electronics. However, Triad Group is 1.29 times more volatile than Samsung Electronics Co. It trades about 0.51 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about -0.02 per unit of risk. If you would invest 28,000 in Triad Group PLC on October 20, 2024 and sell it today you would earn a total of 6,500 from holding Triad Group PLC or generate 23.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Triad Group PLC vs. Samsung Electronics Co
Performance |
| Timeline |
| Triad Group PLC |
| Samsung Electronics |
Triad Group and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Triad Group and Samsung Electronics
The main advantage of trading using opposite Triad Group and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Triad Group position performs unexpectedly, Samsung Electronics 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 Samsung Electronics will offset losses from the drop in Samsung Electronics' long position.| Triad Group vs. CNH Industrial NV | Triad Group vs. Software Circle plc | Triad Group vs. Cornish Metals | Triad Group vs. STMicroelectronics NV |
| Samsung Electronics vs. Tatton Asset Management | Samsung Electronics vs. Sabien Technology Group | Samsung Electronics vs. Impax Asset Management | Samsung Electronics vs. mobilezone holding AG |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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