Correlation Between Samsung Life and Organic Special
Can any of the company-specific risk be diversified away by investing in both Samsung Life and Organic Special 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 Life and Organic Special into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samsung Life Insurance and Organic Special Pet, you can compare the effects of market volatilities on Samsung Life and Organic Special 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 Life with a short position of Organic Special. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Life and Organic Special.
Diversification Opportunities for Samsung Life and Organic Special
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Samsung and Organic is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Life Insurance and Organic Special Pet in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Organic Special Pet and Samsung Life 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 Life Insurance are associated (or correlated) with Organic Special. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Organic Special Pet has no effect on the direction of Samsung Life i.e., Samsung Life and Organic Special go up and down completely randomly.
Pair Corralation between Samsung Life and Organic Special
Assuming the 90 days trading horizon Samsung Life Insurance is expected to generate 1.13 times more return on investment than Organic Special. However, Samsung Life is 1.13 times more volatile than Organic Special Pet. It trades about 0.06 of its potential returns per unit of risk. Organic Special Pet is currently generating about -0.19 per unit of risk. If you would invest 9,560,000 in Samsung Life Insurance on September 26, 2024 and sell it today you would earn a total of 700,000 from holding Samsung Life Insurance or generate 7.32% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Samsung Life Insurance vs. Organic Special Pet
Performance |
Timeline |
Samsung Life Insurance |
Organic Special Pet |
Samsung Life and Organic Special Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Samsung Life and Organic Special
The main advantage of trading using opposite Samsung Life and Organic Special positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Life position performs unexpectedly, Organic Special 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 Organic Special will offset losses from the drop in Organic Special's long position.Samsung Life vs. Kbi Metal Co | Samsung Life vs. CKH Food Health | Samsung Life vs. SK Chemicals Co | Samsung Life vs. LG Household Healthcare |
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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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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