Correlation Between Samsung Electronics and Falken Industries
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Falken Industries 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 Falken Industries 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 Falken Industries, you can compare the effects of market volatilities on Samsung Electronics and Falken Industries 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 Falken Industries. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Falken Industries.
Diversification Opportunities for Samsung Electronics and Falken Industries
-1.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Samsung and Falken is -1.0. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Falken Industries in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Falken Industries 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 Falken Industries. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Falken Industries has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Falken Industries go up and down completely randomly.
Pair Corralation between Samsung Electronics and Falken Industries
If you would invest 0.01 in Falken Industries on October 11, 2024 and sell it today you would earn a total of 0.00 from holding Falken Industries or generate 0.0% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Strong |
Accuracy | 95.45% |
Values | Daily Returns |
Samsung Electronics Co vs. Falken Industries
Performance |
Timeline |
Samsung Electronics |
Falken Industries |
Samsung Electronics and Falken Industries Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Samsung Electronics and Falken Industries
The main advantage of trading using opposite Samsung Electronics and Falken Industries positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Falken Industries 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 Falken Industries will offset losses from the drop in Falken Industries' long position.Samsung Electronics vs. XCPCNL Business Services | Samsung Electronics vs. International Consolidated Companies | Samsung Electronics vs. Mills Music Trust | Samsung Electronics vs. Citrine Global Corp |
Falken Industries vs. G6 Materials Corp | Falken Industries vs. Nano One Materials | Falken Industries vs. Haydale Graphene Industries |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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