Correlation Between KTB Investment and Sang A
Can any of the company-specific risk be diversified away by investing in both KTB Investment and Sang A 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 KTB Investment and Sang A into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KTB Investment Securities and Sang A Frontec CoLtd, you can compare the effects of market volatilities on KTB Investment and Sang A 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 KTB Investment with a short position of Sang A. Check out your portfolio center. Please also check ongoing floating volatility patterns of KTB Investment and Sang A.
Diversification Opportunities for KTB Investment and Sang A
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between KTB and Sang is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding KTB Investment Securities and Sang A Frontec CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sang A Frontec and KTB Investment 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 KTB Investment Securities are associated (or correlated) with Sang A. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sang A Frontec has no effect on the direction of KTB Investment i.e., KTB Investment and Sang A go up and down completely randomly.
Pair Corralation between KTB Investment and Sang A
Assuming the 90 days trading horizon KTB Investment Securities is expected to generate 3.01 times more return on investment than Sang A. However, KTB Investment is 3.01 times more volatile than Sang A Frontec CoLtd. It trades about 0.16 of its potential returns per unit of risk. Sang A Frontec CoLtd is currently generating about -0.24 per unit of risk. If you would invest 260,000 in KTB Investment Securities on October 17, 2024 and sell it today you would earn a total of 35,000 from holding KTB Investment Securities or generate 13.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KTB Investment Securities vs. Sang A Frontec CoLtd
Performance |
| Timeline |
| KTB Investment Securities |
| Sang A Frontec |
KTB Investment and Sang A Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KTB Investment and Sang A
The main advantage of trading using opposite KTB Investment and Sang A positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KTB Investment position performs unexpectedly, Sang A 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 Sang A will offset losses from the drop in Sang A's long position.| KTB Investment vs. Daou Technology | KTB Investment vs. Eagle Veterinary Technology | KTB Investment vs. BIT Computer Co | KTB Investment vs. KG Eco Technology |
| Sang A vs. DONGKUK TED METAL | Sang A vs. Korea Investment Holdings | Sang A vs. Kukdong Oil Chemicals | Sang A vs. Daejung Chemicals Metals |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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