Correlation Between Samsung Asset and Samsung KODEX

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

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

Diversification Opportunities for Samsung Asset and Samsung KODEX

-0.78

Correlation Coefficient

Samsung Asset  Samsung KODEX

Pay attention - limited upside

The 3 months correlation between Samsung and Samsung is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Asset Management and Samsung KODEX IT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung KODEX IT and Samsung Asset 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 Asset Management are associated (or correlated) with Samsung KODEX. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samsung KODEX IT has no effect on the direction of Samsung Asset i.e., Samsung Asset and Samsung KODEX go up and down completely randomly.

Pair Corralation between Samsung Asset and Samsung KODEX

Assuming the 90 days trading horizon Samsung Asset Management is expected to under-perform the Samsung KODEX. But the etf apears to be less risky and, when comparing its historical volatility, Samsung Asset Management is 1.35 times less risky than Samsung KODEX. The etf trades about -0.01 of its potential returns per unit of risk. The Samsung KODEX IT is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest  1,412,000  in Samsung KODEX IT on October 9, 2024 and sell it today you would earn a total of  160,000  from holding Samsung KODEX IT or generate 11.33% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Samsung Asset Management  vs.  Samsung KODEX IT

Samsung Asset Management

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Samsung Asset Management are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Samsung Asset is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Samsung KODEX IT

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Samsung KODEX IT has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Etf's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the ETF investors.

Pair Trading with Samsung Asset and Samsung KODEX

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

The idea behind Samsung Asset Management and Samsung KODEX IT 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.