Correlation Between Samsung Electronics and 4Imprint Group

Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and 4Imprint Group 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 4Imprint Group 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 4Imprint Group Plc, you can compare the effects of market volatilities on Samsung Electronics and 4Imprint Group 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 4Imprint Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and 4Imprint Group.

Diversification Opportunities for Samsung Electronics and 4Imprint Group

0.23

Correlation Coefficient

Samsung Electronics  4Imprint Group

Modest diversification

The 3 months correlation between Samsung and 4Imprint is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and 4Imprint Group Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 4Imprint Group Plc 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 4Imprint Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 4Imprint Group Plc has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and 4Imprint Group go up and down completely randomly.

Pair Corralation between Samsung Electronics and 4Imprint Group

Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the 4Imprint Group. But the stock apears to be less risky and, when comparing its historical volatility, Samsung Electronics Co is 1.01 times less risky than 4Imprint Group. The stock trades about -0.06 of its potential returns per unit of risk. The 4Imprint Group Plc is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  418,938  in 4Imprint Group Plc on September 28, 2024 and sell it today you would earn a total of  61,062  from holding 4Imprint Group Plc or generate 14.58% return on investment over 90 days.

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

Samsung Electronics Co  vs.  4Imprint Group Plc

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.

4Imprint Group Plc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days 4Imprint Group Plc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, 4Imprint Group is not utilizing all of its potentials. The newest stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Samsung Electronics and 4Imprint Group

The main advantage of trading using opposite Samsung Electronics and 4Imprint Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, 4Imprint Group 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 4Imprint Group will offset losses from the drop in 4Imprint Group's long position.

The idea behind Samsung Electronics Co and 4Imprint Group Plc 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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .