Correlation Between Samsung Biologics and Seers Technology

Can any of the company-specific risk be diversified away by investing in both Samsung Biologics and Seers Technology 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 Biologics and Seers Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Samsung Biologics Co and Seers Technology, you can compare the effects of market volatilities on Samsung Biologics and Seers Technology 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 Biologics with a short position of Seers Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Biologics and Seers Technology.

Diversification Opportunities for Samsung Biologics and Seers Technology

0.73

Correlation Coefficient

Samsung Biologics  Seers Technology

Poor diversification

The 3 months correlation between Samsung and Seers is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Biologics Co and Seers Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Seers Technology and Samsung Biologics 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 Biologics Co are associated (or correlated) with Seers Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Seers Technology has no effect on the direction of Samsung Biologics i.e., Samsung Biologics and Seers Technology go up and down completely randomly.

Pair Corralation between Samsung Biologics and Seers Technology

Assuming the 90 days trading horizon Samsung Biologics is expected to generate 4.8 times less return on investment than Seers Technology. But when comparing it to its historical volatility, Samsung Biologics Co is 6.51 times less risky than Seers Technology. It trades about 0.18 of its potential returns per unit of risk. Seers Technology is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  1,060,000  in Seers Technology on December 24, 2024 and sell it today you would earn a total of  327,000  from holding Seers Technology or generate 30.85% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.28%
Values	Daily Returns

Samsung Biologics Co  vs.  Seers Technology

Samsung Biologics

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Samsung Biologics Co are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Samsung Biologics may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Seers Technology

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Seers Technology are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Seers Technology sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Samsung Biologics and Seers Technology

The main advantage of trading using opposite Samsung Biologics and Seers Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Biologics position performs unexpectedly, Seers Technology 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 Seers Technology will offset losses from the drop in Seers Technology's long position.

The idea behind Samsung Biologics Co and Seers Technology pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.