Correlation Between Kbi Metal and TJ Media
Can any of the company-specific risk be diversified away by investing in both Kbi Metal and TJ Media 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 TJ Media 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 TJ media Co, you can compare the effects of market volatilities on Kbi Metal and TJ Media 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 TJ Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kbi Metal and TJ Media.
Diversification Opportunities for Kbi Metal and TJ Media
Very weak diversification
The 3 months correlation between Kbi and 032540 is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Kbi Metal Co and TJ media Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TJ media 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 TJ Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TJ media has no effect on the direction of Kbi Metal i.e., Kbi Metal and TJ Media go up and down completely randomly.
Pair Corralation between Kbi Metal and TJ Media
Assuming the 90 days trading horizon Kbi Metal Co is expected to generate 2.98 times more return on investment than TJ Media. However, Kbi Metal is 2.98 times more volatile than TJ media Co. It trades about 0.12 of its potential returns per unit of risk. TJ media Co is currently generating about 0.06 per unit of risk. If you would invest 202,500 in Kbi Metal Co on November 3, 2024 and sell it today you would earn a total of 14,000 from holding Kbi Metal Co or generate 6.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kbi Metal Co vs. TJ media Co
Performance |
| Timeline |
| Kbi Metal |
| TJ media |
Kbi Metal and TJ Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kbi Metal and TJ Media
The main advantage of trading using opposite Kbi Metal and TJ Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kbi Metal position performs unexpectedly, TJ Media 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 TJ Media will offset losses from the drop in TJ Media's long position.| Kbi Metal vs. Namhwa Industrial Co | Kbi Metal vs. PJ Metal Co | Kbi Metal vs. Seoul Food Industrial | Kbi Metal vs. SCI Information Service |
| TJ Media vs. Daishin Information Communications | TJ Media vs. Woori Technology Investment | TJ Media vs. Daol Investment Securities | TJ Media vs. SBI Investment KOREA |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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