Correlation Between Samsung Electronics and Concurrent Technologies
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and Concurrent Technologies 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 Concurrent Technologies 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 Concurrent Technologies Plc, you can compare the effects of market volatilities on Samsung Electronics and Concurrent Technologies 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 Concurrent Technologies. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and Concurrent Technologies.
Diversification Opportunities for Samsung Electronics and Concurrent Technologies
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Samsung and Concurrent is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and Concurrent Technologies Plc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Concurrent Technologies 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 Concurrent Technologies. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Concurrent Technologies has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and Concurrent Technologies go up and down completely randomly.
Pair Corralation between Samsung Electronics and Concurrent Technologies
Assuming the 90 days trading horizon Samsung Electronics Co is expected to under-perform the Concurrent Technologies. But the stock apears to be less risky and, when comparing its historical volatility, Samsung Electronics Co is 1.25 times less risky than Concurrent Technologies. The stock trades about -0.15 of its potential returns per unit of risk. The Concurrent Technologies Plc is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 12,225 in Concurrent Technologies Plc on September 12, 2024 and sell it today you would earn a total of 1,525 from holding Concurrent Technologies Plc or generate 12.47% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Samsung Electronics Co vs. Concurrent Technologies Plc
Performance |
Timeline |
Samsung Electronics |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Concurrent Technologies |
Samsung Electronics and Concurrent Technologies Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Samsung Electronics and Concurrent Technologies
The main advantage of trading using opposite Samsung Electronics and Concurrent Technologies positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, Concurrent Technologies 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 Concurrent Technologies will offset losses from the drop in Concurrent Technologies' long position.Samsung Electronics vs. Fidelity National Information | Samsung Electronics vs. Edita Food Industries | Samsung Electronics vs. Axfood AB | Samsung Electronics vs. Air Products Chemicals |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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