Correlation Between Kbi Metal and Sam Yang
Can any of the company-specific risk be diversified away by investing in both Kbi Metal and Sam Yang 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 Kbi Metal and Sam Yang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kbi Metal Co and Sam Yang Foods, you can compare the effects of market volatilities on Kbi Metal and Sam Yang 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 Kbi Metal with a short position of Sam Yang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kbi Metal and Sam Yang.
Diversification Opportunities for Kbi Metal and Sam Yang
Good diversification
The 3 months correlation between Kbi and Sam is -0.15. Overlapping area represents the amount of risk that can be diversified away by holding Kbi Metal Co and Sam Yang Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sam Yang Foods and Kbi Metal 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 Kbi Metal Co are associated (or correlated) with Sam Yang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sam Yang Foods has no effect on the direction of Kbi Metal i.e., Kbi Metal and Sam Yang go up and down completely randomly.
Pair Corralation between Kbi Metal and Sam Yang
Assuming the 90 days trading horizon Kbi Metal is expected to generate 1.99 times less return on investment than Sam Yang. In addition to that, Kbi Metal is 1.33 times more volatile than Sam Yang Foods. It trades about 0.04 of its total potential returns per unit of risk. Sam Yang Foods is currently generating about 0.11 per unit of volatility. If you would invest 11,753,400 in Sam Yang Foods on August 27, 2024 and sell it today you would earn a total of 41,446,600 from holding Sam Yang Foods or generate 352.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kbi Metal Co vs. Sam Yang Foods
Performance |
| Timeline |
| Kbi Metal |
| Sam Yang Foods |
Kbi Metal and Sam Yang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kbi Metal and Sam Yang
The main advantage of trading using opposite Kbi Metal and Sam Yang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kbi Metal position performs unexpectedly, Sam Yang 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 Sam Yang will offset losses from the drop in Sam Yang's long position.| Kbi Metal vs. Busan Industrial Co | Kbi Metal vs. Busan Ind | Kbi Metal vs. Mirae Asset Daewoo | Kbi Metal vs. UNISEM Co |
| Sam Yang vs. Lotte Data Communication | Sam Yang vs. Woorim Machinery Co | Sam Yang vs. Jeong Moon Information | Sam Yang vs. GS Engineering Construction |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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