Correlation Between Samsung Electronics and CDN IMPERIAL
Can any of the company-specific risk be diversified away by investing in both Samsung Electronics and CDN IMPERIAL 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 CDN IMPERIAL 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 CDN IMPERIAL BANK, you can compare the effects of market volatilities on Samsung Electronics and CDN IMPERIAL 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 CDN IMPERIAL. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Electronics and CDN IMPERIAL.
Diversification Opportunities for Samsung Electronics and CDN IMPERIAL
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Samsung and CDN is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Electronics Co and CDN IMPERIAL BANK in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CDN IMPERIAL BANK 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 CDN IMPERIAL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CDN IMPERIAL BANK has no effect on the direction of Samsung Electronics i.e., Samsung Electronics and CDN IMPERIAL go up and down completely randomly.
Pair Corralation between Samsung Electronics and CDN IMPERIAL
Assuming the 90 days horizon Samsung Electronics Co is expected to generate 3.0 times more return on investment than CDN IMPERIAL. However, Samsung Electronics is 3.0 times more volatile than CDN IMPERIAL BANK. It trades about 0.14 of its potential returns per unit of risk. CDN IMPERIAL BANK is currently generating about 0.39 per unit of risk. If you would invest 83,400 in Samsung Electronics Co on April 24, 2025 and sell it today you would earn a total of 17,100 from holding Samsung Electronics Co or generate 20.5% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Samsung Electronics Co vs. CDN IMPERIAL BANK
Performance |
Timeline |
Samsung Electronics |
CDN IMPERIAL BANK |
Samsung Electronics and CDN IMPERIAL Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Samsung Electronics and CDN IMPERIAL
The main advantage of trading using opposite Samsung Electronics and CDN IMPERIAL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Electronics position performs unexpectedly, CDN IMPERIAL 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 CDN IMPERIAL will offset losses from the drop in CDN IMPERIAL's long position.Samsung Electronics vs. Alfa Financial Software | Samsung Electronics vs. PETCO HEALTH CLA | Samsung Electronics vs. X FAB Silicon Foundries | Samsung Electronics vs. VARIOUS EATERIES LS |
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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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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