Correlation Between Samsung Electronics and BHP
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and BHP 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 BHP 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 BHP Group, you can compare the effects of market volatilities on Samsung Electronics and BHP 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 BHP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and BHP.
Diversification Opportunities for Samsung Electronics and BHP
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Samsung and BHP is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and BHP Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BHP Group 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 BHP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BHP Group has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and BHP go up and down completely randomly.
Pair Corralation between Samsung Electronics and BHP
If you would invest 113,920 in BHP Group on September 23, 2024 and sell it today you would earn a total of 0.00 from holding BHP Group or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Samsung Electronics Co vs. BHP Group
Performance |
Timeline |
Samsung Electronics |
BHP Group |
Samsung Electronics and BHP Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Samsung Electronics and BHP
The main advantage of trading using opposite Samsung Electronics and BHP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, BHP 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 BHP will offset losses from the drop in BHP's long position.Samsung Electronics vs. Amazon Inc | Samsung Electronics vs. Microsoft | Samsung Electronics vs. Tesla Inc | Samsung Electronics vs. Alphabet Inc Class A |
BHP vs. Grupo Carso SAB | BHP vs. Cognizant Technology Solutions | BHP vs. Samsung Electronics Co | BHP vs. GMxico Transportes SAB |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
Other Complementary Tools
Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences |