Correlation Between Kbi Metal and Hyundai Home
Can any of the company-specific risk be diversified away by investing in both Kbi Metal and Hyundai Home 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 Hyundai Home 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 Hyundai Home Shopping, you can compare the effects of market volatilities on Kbi Metal and Hyundai Home 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 Hyundai Home. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kbi Metal and Hyundai Home.
Diversification Opportunities for Kbi Metal and Hyundai Home
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kbi and Hyundai is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Kbi Metal Co and Hyundai Home Shopping in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hyundai Home Shopping 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 Hyundai Home. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hyundai Home Shopping has no effect on the direction of Kbi Metal i.e., Kbi Metal and Hyundai Home go up and down completely randomly.
Pair Corralation between Kbi Metal and Hyundai Home
Assuming the 90 days trading horizon Kbi Metal Co is expected to generate 2.57 times more return on investment than Hyundai Home. However, Kbi Metal is 2.57 times more volatile than Hyundai Home Shopping. It trades about 0.18 of its potential returns per unit of risk. Hyundai Home Shopping is currently generating about -0.27 per unit of risk. If you would invest 196,900 in Kbi Metal Co on October 14, 2024 and sell it today you would earn a total of 22,600 from holding Kbi Metal Co or generate 11.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kbi Metal Co vs. Hyundai Home Shopping
Performance |
| Timeline |
| Kbi Metal |
| Hyundai Home Shopping |
Kbi Metal and Hyundai Home Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kbi Metal and Hyundai Home
The main advantage of trading using opposite Kbi Metal and Hyundai Home positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kbi Metal position performs unexpectedly, Hyundai Home 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 Hyundai Home will offset losses from the drop in Hyundai Home's long position.| Kbi Metal vs. FNSTech Co | Kbi Metal vs. RFTech Co | Kbi Metal vs. SS TECH | Kbi Metal vs. Sungchang Autotech Co |
| Hyundai Home vs. ECSTELECOM Co | Hyundai Home vs. SK Telecom Co | Hyundai Home vs. Handok Clean Tech | Hyundai Home vs. Ssangyong Information Communication |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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