Correlation Between URU Metals and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both URU Metals 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 URU Metals and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between URU Metals and Samsung Electronics Co, you can compare the effects of market volatilities on URU Metals 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 URU Metals with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of URU Metals and Samsung Electronics.
Diversification Opportunities for URU Metals and Samsung Electronics
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between URU and Samsung is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding URU Metals and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and URU Metals 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 URU Metals 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 URU Metals i.e., URU Metals and Samsung Electronics go up and down completely randomly.
Pair Corralation between URU Metals and Samsung Electronics
Assuming the 90 days trading horizon URU Metals is expected to generate 3.97 times more return on investment than Samsung Electronics. However, URU Metals is 3.97 times more volatile than Samsung Electronics Co. It trades about 0.03 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 15,000 in URU Metals on November 7, 2024 and sell it today you would earn a total of 2,000 from holding URU Metals or generate 13.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
URU Metals vs. Samsung Electronics Co
Performance |
| Timeline |
| URU Metals |
| Samsung Electronics |
URU Metals and Samsung Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with URU Metals and Samsung Electronics
The main advantage of trading using opposite URU Metals and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if URU Metals 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.| URU Metals vs. Pets at Home | URU Metals vs. Bisichi Mining PLC | URU Metals vs. Eastman Chemical Co | URU Metals vs. Eastinco Mining Exploration |
| Samsung Electronics vs. Optima Health plc | Samsung Electronics vs. Abingdon Health Plc | Samsung Electronics vs. CVS Health Corp | Samsung Electronics vs. Automatic Data Processing |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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