Correlation Between PureTech Health and Samsung Electronics

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

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

Diversification Opportunities for PureTech Health and Samsung Electronics

0.04

Correlation Coefficient

PureTech Health  Samsung Electronics

Significant diversification

The 3 months correlation between PureTech and Samsung is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding PureTech Health plc and Samsung Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Electronics and PureTech Health 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 PureTech Health plc 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 PureTech Health i.e., PureTech Health and Samsung Electronics go up and down completely randomly.

Pair Corralation between PureTech Health and Samsung Electronics

Assuming the 90 days trading horizon PureTech Health plc is expected to under-perform the Samsung Electronics. In addition to that, PureTech Health is 1.05 times more volatile than Samsung Electronics Co. It trades about -0.07 of its total potential returns per unit of risk. Samsung Electronics Co is currently generating about 0.16 per unit of volatility. If you would invest  83,449  in Samsung Electronics Co on June 2, 2025 and sell it today you would earn a total of  17,051  from holding Samsung Electronics Co or generate 20.43% return on investment over 90 days.

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

PureTech Health plc  vs.  Samsung Electronics Co

PureTech Health plc

Risk-Adjusted Performance

Weakest

Over the last 90 days PureTech Health plc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest unsteady performance, the Stock's basic indicators remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

Samsung Electronics

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Samsung Electronics Co are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unsteady basic indicators, Samsung Electronics unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with PureTech Health and Samsung Electronics

The main advantage of trading using opposite PureTech Health and Samsung Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PureTech Health 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 PureTech Health plc 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.

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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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.