Correlation Between Jinro Distillers and Kbi Metal
Can any of the company-specific risk be diversified away by investing in both Jinro Distillers and Kbi Metal 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 Jinro Distillers and Kbi Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jinro Distillers Co and Kbi Metal Co, you can compare the effects of market volatilities on Jinro Distillers and Kbi Metal 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 Jinro Distillers with a short position of Kbi Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jinro Distillers and Kbi Metal.
Diversification Opportunities for Jinro Distillers and Kbi Metal
-0.13 | Correlation Coefficient |
Good diversification
The 3 months correlation between Jinro and Kbi is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Jinro Distillers Co and Kbi Metal Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kbi Metal and Jinro Distillers 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 Jinro Distillers Co are associated (or correlated) with Kbi Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kbi Metal has no effect on the direction of Jinro Distillers i.e., Jinro Distillers and Kbi Metal go up and down completely randomly.
Pair Corralation between Jinro Distillers and Kbi Metal
Assuming the 90 days trading horizon Jinro Distillers Co is expected to generate 0.33 times more return on investment than Kbi Metal. However, Jinro Distillers Co is 3.05 times less risky than Kbi Metal. It trades about -0.18 of its potential returns per unit of risk. Kbi Metal Co is currently generating about -0.4 per unit of risk. If you would invest 1,777,000 in Jinro Distillers Co on September 1, 2024 and sell it today you would lose (75,000) from holding Jinro Distillers Co or give up 4.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jinro Distillers Co vs. Kbi Metal Co
Performance |
| Timeline |
| Jinro Distillers |
| Kbi Metal |
Jinro Distillers and Kbi Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jinro Distillers and Kbi Metal
The main advantage of trading using opposite Jinro Distillers and Kbi Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jinro Distillers position performs unexpectedly, Kbi Metal 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 Kbi Metal will offset losses from the drop in Kbi Metal's long position.| Jinro Distillers vs. LG Display Co | Jinro Distillers vs. Nam Hwa Construction | Jinro Distillers vs. Dongwoo Farm To | Jinro Distillers vs. GS Engineering Construction |
| Kbi Metal vs. LG Display | Kbi Metal vs. Hyundai Motor Co | Kbi Metal vs. Hyundai Motor Co | Kbi Metal vs. Adaptive Plasma Technology |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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