Correlation Between Turtle Beach and Samsung Electronics

Can any of the company-specific risk be diversified away by investing in both Turtle Beach and Samsung Electronics 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 Turtle Beach and Samsung Electronics into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Turtle Beach Corp and Samsung Electronics Co, you can compare the effects of market volatilities on Turtle Beach and Samsung Electronics 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 Turtle Beach with a short position of Samsung Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Turtle Beach and Samsung Electronics.

Diversification Opportunities for Turtle Beach and Samsung Electronics

0.62

Correlation Coefficient

Turtle Beach  Samsung Electronics

Poor diversification

The 3 months correlation between Turtle and Samsung is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Turtle Beach Corp and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and Turtle Beach 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 Turtle Beach Corp are associated (or correlated) with Samsung Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samsung Electronics has no effect on the direction of Turtle Beach i.e., Turtle Beach and Samsung Electronics go up and down completely randomly.

Pair Corralation between Turtle Beach and Samsung Electronics

Given the investment horizon of 90 days Turtle Beach Corp is expected to generate 34.29 times more return on investment than Samsung Electronics. However, Turtle Beach is 34.29 times more volatile than Samsung Electronics Co. It trades about 0.09 of its potential returns per unit of risk. Samsung Electronics Co is currently generating about 0.13 per unit of risk. If you would invest  1,496  in Turtle Beach Corp on September 1, 2024 and sell it today you would earn a total of  235.00  from holding Turtle Beach Corp or generate 15.71% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

Turtle Beach Corp  vs.  Samsung Electronics Co

Turtle Beach Corp

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Turtle Beach Corp are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, Turtle Beach reported solid returns over the last few months and may actually be approaching a breakup point.

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 latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with Turtle Beach and Samsung Electronics

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

The idea behind Turtle Beach Corp and Samsung Electronics Co 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.