Correlation Between 476810 and Samsung Asset
Can any of the company-specific risk be diversified away by investing in both 476810 and Samsung Asset 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 476810 and Samsung Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between 476810 and Samsung Asset Management, you can compare the effects of market volatilities on 476810 and Samsung Asset 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 476810 with a short position of Samsung Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of 476810 and Samsung Asset.
Diversification Opportunities for 476810 and Samsung Asset
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 476810 and Samsung is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding 476810 and Samsung Asset Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Asset Management and 476810 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 476810 are associated (or correlated) with Samsung Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samsung Asset Management has no effect on the direction of 476810 i.e., 476810 and Samsung Asset go up and down completely randomly.
Pair Corralation between 476810 and Samsung Asset
Assuming the 90 days trading horizon 476810 is expected to generate 6.92 times less return on investment than Samsung Asset. But when comparing it to its historical volatility, 476810 is 22.41 times less risky than Samsung Asset. It trades about 0.36 of its potential returns per unit of risk. Samsung Asset Management is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 908,484 in Samsung Asset Management on October 31, 2024 and sell it today you would earn a total of 804,516 from holding Samsung Asset Management or generate 88.56% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 43.43% |
Values | Daily Returns |
476810 vs. Samsung Asset Management
Performance |
Timeline |
476810 |
Samsung Asset Management |
476810 and Samsung Asset Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with 476810 and Samsung Asset
The main advantage of trading using opposite 476810 and Samsung Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 476810 position performs unexpectedly, Samsung Asset 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 Asset will offset losses from the drop in Samsung Asset's long position.The idea behind 476810 and Samsung Asset Management 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.Samsung Asset vs. Samsung KODEX IT | ||
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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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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