Correlation Between Samsung Electronics and GNS

Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and GNS 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 GNS 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 The GNS Group, you can compare the effects of market volatilities on Samsung Electronics and GNS 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 GNS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and GNS.

Diversification Opportunities for Samsung Electronics and GNS

-0.71

Correlation Coefficient

Samsung Electronics  GNS

Pay attention - limited upside

The 3 months correlation between Samsung and GNS is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and The GNS Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GNS Group 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 GNS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GNS Group has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and GNS go up and down completely randomly.

Pair Corralation between Samsung Electronics and GNS

If you would invest  4,060  in Samsung Electronics Co on September 19, 2024 and sell it today you would earn a total of  0.00  from holding Samsung Electronics Co or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	97.62%
Values	Daily Returns

Samsung Electronics Co  vs.  The GNS Group

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

GNS Group

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days The GNS Group has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's basic indicators remain very healthy which may send shares a bit higher in January 2025. The recent disarray may also be a sign of long period up-swing for the firm investors.

Pair Trading with Samsung Electronics and GNS

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

The idea behind Samsung Electronics Co and The GNS Group 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.