Correlation Between Kbi Metal and Daewoo SBI
Can any of the company-specific risk be diversified away by investing in both Kbi Metal and Daewoo SBI 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 Daewoo SBI 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 Daewoo SBI SPAC, you can compare the effects of market volatilities on Kbi Metal and Daewoo SBI 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 Daewoo SBI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kbi Metal and Daewoo SBI.
Diversification Opportunities for Kbi Metal and Daewoo SBI
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Kbi and Daewoo is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Kbi Metal Co and Daewoo SBI SPAC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daewoo SBI SPAC 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 Daewoo SBI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daewoo SBI SPAC has no effect on the direction of Kbi Metal i.e., Kbi Metal and Daewoo SBI go up and down completely randomly.
Pair Corralation between Kbi Metal and Daewoo SBI
Assuming the 90 days trading horizon Kbi Metal Co is expected to under-perform the Daewoo SBI. In addition to that, Kbi Metal is 1.83 times more volatile than Daewoo SBI SPAC. It trades about -0.4 of its total potential returns per unit of risk. Daewoo SBI SPAC is currently generating about -0.3 per unit of volatility. If you would invest 267,000 in Daewoo SBI SPAC on September 1, 2024 and sell it today you would lose (31,000) from holding Daewoo SBI SPAC or give up 11.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kbi Metal Co vs. Daewoo SBI SPAC
Performance |
| Timeline |
| Kbi Metal |
| Daewoo SBI SPAC |
Kbi Metal and Daewoo SBI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kbi Metal and Daewoo SBI
The main advantage of trading using opposite Kbi Metal and Daewoo SBI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kbi Metal position performs unexpectedly, Daewoo SBI 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 Daewoo SBI will offset losses from the drop in Daewoo SBI's long position.| Kbi Metal vs. LG Display | Kbi Metal vs. Hyundai Motor | Kbi Metal vs. Hyundai Motor Co | Kbi Metal vs. Hyundai Motor Co |
| Daewoo SBI vs. Choil Aluminum | Daewoo SBI vs. Cube Entertainment | Daewoo SBI vs. Kbi Metal Co | Daewoo SBI vs. Asiana Airlines |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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