Correlation Between Casio Computer and Samsung Electronics
Can any of the company-specific risk be diversified away by investing in both Casio Computer 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 Casio Computer and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Casio Computer CoLtd and Samsung Electronics Co, you can compare the effects of market volatilities on Casio Computer 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 Casio Computer with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Casio Computer and Samsung Electronics.
Diversification Opportunities for Casio Computer and Samsung Electronics
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Casio and Samsung is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Casio Computer CoLtd and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and Casio Computer 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 Casio Computer CoLtd 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 Casio Computer i.e., Casio Computer and Samsung Electronics go up and down completely randomly.
Pair Corralation between Casio Computer and Samsung Electronics
Assuming the 90 days trading horizon Casio Computer CoLtd is expected to generate 0.84 times more return on investment than Samsung Electronics. However, Casio Computer CoLtd is 1.19 times less risky than Samsung Electronics. It trades about 0.27 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about -0.08 per unit of risk. If you would invest 738.00 in Casio Computer CoLtd on October 4, 2024 and sell it today you would earn a total of 53.00 from holding Casio Computer CoLtd or generate 7.18% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Casio Computer CoLtd vs. Samsung Electronics Co
Performance |
Timeline |
Casio Computer CoLtd |
Samsung Electronics |
Casio Computer and Samsung Electronics Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Casio Computer and Samsung Electronics
The main advantage of trading using opposite Casio Computer and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Casio Computer 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.Casio Computer vs. Samsung Electronics Co | Casio Computer vs. Samsung Electronics Co | Casio Computer vs. Sony Group | Casio Computer vs. Superior Plus Corp |
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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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