Correlation Between Samsung Electronics and Jupiter Fund

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

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

Diversification Opportunities for Samsung Electronics and Jupiter Fund

0.5

Correlation Coefficient

Samsung Electronics  Jupiter Fund

Very weak diversification

The 3 months correlation between Samsung and Jupiter is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Jupiter Fund Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jupiter Fund Management and Samsung Electronics 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 Electronics Co are associated (or correlated) with Jupiter Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jupiter Fund Management has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Jupiter Fund go up and down completely randomly.

Pair Corralation between Samsung Electronics and Jupiter Fund

Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the Jupiter Fund. In addition to that, Samsung Electronics is 1.18 times more volatile than Jupiter Fund Management. It trades about -0.34 of its total potential returns per unit of risk. Jupiter Fund Management is currently generating about 0.1 per unit of volatility. If you would invest  8,320  in Jupiter Fund Management on September 24, 2024 and sell it today you would earn a total of  260.00  from holding Jupiter Fund Management or generate 3.13% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	95.45%
Values	Daily Returns

Samsung Electronics Co  vs.  Jupiter Fund Management

Samsung Electronics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Samsung Electronics Co has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the firm private investors.

Jupiter Fund Management

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Jupiter Fund Management has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound technical and fundamental indicators, Jupiter Fund is not utilizing all of its potentials. The newest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Samsung Electronics and Jupiter Fund

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

The idea behind Samsung Electronics Co and Jupiter Fund 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.

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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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.