Correlation Between Kbi Metal and Jahwa Electron
Can any of the company-specific risk be diversified away by investing in both Kbi Metal and Jahwa Electron 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 Jahwa Electron 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 Jahwa Electron, you can compare the effects of market volatilities on Kbi Metal and Jahwa Electron 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 Jahwa Electron. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kbi Metal and Jahwa Electron.
Diversification Opportunities for Kbi Metal and Jahwa Electron
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Kbi and Jahwa is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Kbi Metal Co and Jahwa Electron in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jahwa Electron 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 Jahwa Electron. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jahwa Electron has no effect on the direction of Kbi Metal i.e., Kbi Metal and Jahwa Electron go up and down completely randomly.
Pair Corralation between Kbi Metal and Jahwa Electron
Assuming the 90 days trading horizon Kbi Metal is expected to generate 27.63 times less return on investment than Jahwa Electron. But when comparing it to its historical volatility, Kbi Metal Co is 1.31 times less risky than Jahwa Electron. It trades about 0.02 of its potential returns per unit of risk. Jahwa Electron is currently generating about 0.38 of returns per unit of risk over similar time horizon. If you would invest 1,221,000 in Jahwa Electron on November 8, 2024 and sell it today you would earn a total of 492,000 from holding Jahwa Electron or generate 40.29% 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. Jahwa Electron
Performance |
| Timeline |
| Kbi Metal |
| Jahwa Electron |
Kbi Metal and Jahwa Electron Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kbi Metal and Jahwa Electron
The main advantage of trading using opposite Kbi Metal and Jahwa Electron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kbi Metal position performs unexpectedly, Jahwa Electron 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 Jahwa Electron will offset losses from the drop in Jahwa Electron's long position.| Kbi Metal vs. Korea Petro Chemical | Kbi Metal vs. Dongbang Transport Logistics | Kbi Metal vs. Alton Sports CoLtd | Kbi Metal vs. Hanjin Transportation Co |
| Jahwa Electron vs. Air Busan Co | Jahwa Electron vs. Alton Sports CoLtd | Jahwa Electron vs. T3 Entertainment Co | Jahwa Electron vs. Daewon Media Co |
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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