Correlation Between Samsung Electronics and WSP Global
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and WSP Global 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 WSP Global 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 WSP Global, you can compare the effects of market volatilities on Samsung Electronics and WSP Global 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 WSP Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and WSP Global.
Diversification Opportunities for Samsung Electronics and WSP Global
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Samsung and WSP is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and WSP Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WSP Global 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 WSP Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WSP Global has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and WSP Global go up and down completely randomly.
Pair Corralation between Samsung Electronics and WSP Global
If you would invest 17,751 in WSP Global on December 1, 2024 and sell it today you would earn a total of 50.00 from holding WSP Global or generate 0.28% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 95.45% |
Values | Daily Returns |
Samsung Electronics Co vs. WSP Global
Performance |
Timeline |
Samsung Electronics |
WSP Global |
Samsung Electronics and WSP Global Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Samsung Electronics and WSP Global
The main advantage of trading using opposite Samsung Electronics and WSP Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, WSP Global 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 WSP Global will offset losses from the drop in WSP Global's long position.Samsung Electronics vs. Pfizer Inc | Samsung Electronics vs. American Express | Samsung Electronics vs. Alcoa Corp | Samsung Electronics vs. Cisco Systems |
WSP Global vs. George Weston Limited | WSP Global vs. Intact Financial | WSP Global vs. Metro Inc | WSP Global vs. Kingspan Group PLC |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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