Correlation Between Kbi Metal and Daewon Media
Can any of the company-specific risk be diversified away by investing in both Kbi Metal and Daewon 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 Daewon 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 Daewon Media Co, you can compare the effects of market volatilities on Kbi Metal and Daewon 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 Daewon Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kbi Metal and Daewon Media.
Diversification Opportunities for Kbi Metal and Daewon Media
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Kbi and Daewon is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Kbi Metal Co and Daewon Media Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daewon 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 Daewon Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daewon Media has no effect on the direction of Kbi Metal i.e., Kbi Metal and Daewon Media go up and down completely randomly.
Pair Corralation between Kbi Metal and Daewon Media
Assuming the 90 days trading horizon Kbi Metal Co is expected to generate 1.71 times more return on investment than Daewon Media. However, Kbi Metal is 1.71 times more volatile than Daewon Media Co. It trades about 0.1 of its potential returns per unit of risk. Daewon Media Co is currently generating about 0.16 per unit of risk. If you would invest 197,000 in Kbi Metal Co on October 30, 2024 and sell it today you would earn a total of 29,500 from holding Kbi Metal Co or generate 14.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kbi Metal Co vs. Daewon Media Co
Performance |
| Timeline |
| Kbi Metal |
| Daewon Media |
Kbi Metal and Daewon Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kbi Metal and Daewon Media
The main advantage of trading using opposite Kbi Metal and Daewon Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kbi Metal position performs unexpectedly, Daewon 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 Daewon Media will offset losses from the drop in Daewon Media's long position.| Kbi Metal vs. Next Entertainment World | Kbi Metal vs. KTB Investment Securities | Kbi Metal vs. Daewon Media Co | Kbi Metal vs. SAMG Entertainment Co |
| Daewon Media vs. Sangsangin Investment Securities | Daewon Media vs. NH Investment Securities | Daewon Media vs. Samhyun Steel Co | Daewon Media vs. Daehan Steel |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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