Correlation Between Samsung Electronics and World Technology
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and World Technology 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 World Technology 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 World Technology Corp, you can compare the effects of market volatilities on Samsung Electronics and World Technology 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 World Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and World Technology.
Diversification Opportunities for Samsung Electronics and World Technology
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Samsung and World is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and World Technology Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on World Technology Corp 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 World Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of World Technology Corp has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and World Technology go up and down completely randomly.
Pair Corralation between Samsung Electronics and World Technology
If you would invest 30.00 in World Technology Corp on December 2, 2024 and sell it today you would earn a total of 25.00 from holding World Technology Corp or generate 83.33% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 93.02% |
Values | Daily Returns |
Samsung Electronics Co vs. World Technology Corp
Performance |
Timeline |
Samsung Electronics |
World Technology Corp |
Samsung Electronics and World Technology Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Samsung Electronics and World Technology
The main advantage of trading using opposite Samsung Electronics and World Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, World Technology 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 World Technology will offset losses from the drop in World Technology's long position.Samsung Electronics vs. Pfizer Inc | Samsung Electronics vs. American Express | Samsung Electronics vs. Alcoa Corp | Samsung Electronics vs. Cisco Systems |
World Technology vs. Wearable Devices | World Technology vs. LG Display Co | World Technology vs. GoPro Inc |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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