Correlation Between Samsung Electronics and SavMobi Technology

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

Diversification Opportunities for Samsung Electronics and SavMobi Technology

-0.47

Correlation Coefficient

Samsung Electronics  SavMobi Technology

Very good diversification

The 3 months correlation between Samsung and SavMobi is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and SavMobi Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SavMobi Technology 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 SavMobi Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SavMobi Technology has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and SavMobi Technology go up and down completely randomly.

Pair Corralation between Samsung Electronics and SavMobi Technology

If you would invest  216.00  in SavMobi Technology on September 29, 2024 and sell it today you would earn a total of  47.00  from holding SavMobi Technology or generate 21.76% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Samsung Electronics Co  vs.  SavMobi Technology

Samsung Electronics

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Samsung Electronics Co has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable essential indicators, Samsung Electronics is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

SavMobi Technology

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days SavMobi Technology has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong primary indicators, SavMobi Technology is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Samsung Electronics and SavMobi Technology

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

The idea behind Samsung Electronics Co and SavMobi Technology 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.