Correlation Between KTB Investment and Solus Advanced
Can any of the company-specific risk be diversified away by investing in both KTB Investment and Solus Advanced 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 Solus Advanced 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 Solus Advanced Materials, you can compare the effects of market volatilities on KTB Investment and Solus Advanced 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 Solus Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of KTB Investment and Solus Advanced.
Diversification Opportunities for KTB Investment and Solus Advanced
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between KTB and Solus is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding KTB Investment Securities and Solus Advanced Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Solus Advanced Materials 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 Solus Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Solus Advanced Materials has no effect on the direction of KTB Investment i.e., KTB Investment and Solus Advanced go up and down completely randomly.
Pair Corralation between KTB Investment and Solus Advanced
Assuming the 90 days trading horizon KTB Investment Securities is expected to generate 0.73 times more return on investment than Solus Advanced. However, KTB Investment Securities is 1.37 times less risky than Solus Advanced. It trades about 0.01 of its potential returns per unit of risk. Solus Advanced Materials is currently generating about -0.02 per unit of risk. If you would invest 314,630 in KTB Investment Securities on October 11, 2024 and sell it today you would lose (12,130) from holding KTB Investment Securities or give up 3.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KTB Investment Securities vs. Solus Advanced Materials
Performance |
| Timeline |
| KTB Investment Securities |
| Solus Advanced Materials |
KTB Investment and Solus Advanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KTB Investment and Solus Advanced
The main advantage of trading using opposite KTB Investment and Solus Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KTB Investment position performs unexpectedly, Solus Advanced 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 Solus Advanced will offset losses from the drop in Solus Advanced's long position.| KTB Investment vs. Hwangkum Steel Technology | KTB Investment vs. Automobile Pc | KTB Investment vs. Handok Clean Tech | KTB Investment vs. Vina Technology Co |
| Solus Advanced vs. Jeju Semiconductor Corp | Solus Advanced vs. Leaders Technology Investment | Solus Advanced vs. DB Insurance Co | Solus Advanced vs. KTB Investment Securities |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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