Correlation Between Samsung Electronics and Datametrex

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

Diversification Opportunities for Samsung Electronics and Datametrex

-0.31

Correlation Coefficient

Samsung Electronics  Datametrex

Very good diversification

The 3 months correlation between Samsung and Datametrex is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Datametrex AI Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Datametrex AI Limited 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 Datametrex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Datametrex AI Limited has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Datametrex go up and down completely randomly.

Pair Corralation between Samsung Electronics and Datametrex

If you would invest  0.52  in Datametrex AI Limited on September 23, 2024 and sell it today you would lose (0.15) from holding Datametrex AI Limited or give up 28.85% of portfolio value over 90 days.

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

Samsung Electronics Co  vs.  Datametrex AI Limited

Samsung Electronics

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Samsung Electronics Co are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable essential indicators, Samsung Electronics is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

Datametrex AI Limited

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Datametrex AI Limited are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite nearly abnormal basic indicators, Datametrex reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Samsung Electronics and Datametrex

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

The idea behind Samsung Electronics Co and Datametrex AI Limited 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.

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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.