Correlation Between Kuk Young and KakaoBank Corp
Can any of the company-specific risk be diversified away by investing in both Kuk Young and KakaoBank Corp 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 Kuk Young and KakaoBank Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kuk Young GM and KakaoBank Corp, you can compare the effects of market volatilities on Kuk Young and KakaoBank Corp 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 Kuk Young with a short position of KakaoBank Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kuk Young and KakaoBank Corp.
Diversification Opportunities for Kuk Young and KakaoBank Corp
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Kuk and KakaoBank is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Kuk Young GM and KakaoBank Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KakaoBank Corp and Kuk Young 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 Kuk Young GM are associated (or correlated) with KakaoBank Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KakaoBank Corp has no effect on the direction of Kuk Young i.e., Kuk Young and KakaoBank Corp go up and down completely randomly.
Pair Corralation between Kuk Young and KakaoBank Corp
Assuming the 90 days trading horizon Kuk Young is expected to generate 1.05 times less return on investment than KakaoBank Corp. In addition to that, Kuk Young is 4.67 times more volatile than KakaoBank Corp. It trades about 0.02 of its total potential returns per unit of risk. KakaoBank Corp is currently generating about 0.09 per unit of volatility. If you would invest 2,165,000 in KakaoBank Corp on September 1, 2024 and sell it today you would earn a total of 70,000 from holding KakaoBank Corp or generate 3.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Kuk Young GM vs. KakaoBank Corp
Performance |
| Timeline |
| Kuk Young GM |
| KakaoBank Corp |
Kuk Young and KakaoBank Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kuk Young and KakaoBank Corp
The main advantage of trading using opposite Kuk Young and KakaoBank Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kuk Young position performs unexpectedly, KakaoBank Corp 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 KakaoBank Corp will offset losses from the drop in KakaoBank Corp's long position.| Kuk Young vs. Nature and Environment | Kuk Young vs. Busan Industrial Co | Kuk Young vs. Busan Ind | Kuk Young vs. Mirae Asset Daewoo |
| KakaoBank Corp vs. Shinhan Financial Group | KakaoBank Corp vs. Hana Financial | KakaoBank Corp vs. Woori Financial Group | KakaoBank Corp vs. Industrial Bank |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios |