Correlation Between KTB Investment and SAMG Entertainment
Can any of the company-specific risk be diversified away by investing in both KTB Investment and SAMG Entertainment 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 SAMG Entertainment 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 SAMG Entertainment Co, you can compare the effects of market volatilities on KTB Investment and SAMG Entertainment 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 SAMG Entertainment. Check out your portfolio center. Please also check ongoing floating volatility patterns of KTB Investment and SAMG Entertainment.
Diversification Opportunities for KTB Investment and SAMG Entertainment
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between KTB and SAMG is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding KTB Investment Securities and SAMG Entertainment Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SAMG Entertainment 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 SAMG Entertainment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SAMG Entertainment has no effect on the direction of KTB Investment i.e., KTB Investment and SAMG Entertainment go up and down completely randomly.
Pair Corralation between KTB Investment and SAMG Entertainment
Assuming the 90 days trading horizon KTB Investment Securities is expected to generate 0.72 times more return on investment than SAMG Entertainment. However, KTB Investment Securities is 1.39 times less risky than SAMG Entertainment. It trades about 0.0 of its potential returns per unit of risk. SAMG Entertainment Co is currently generating about -0.05 per unit of risk. If you would invest 321,825 in KTB Investment Securities on September 19, 2024 and sell it today you would lose (58,825) from holding KTB Investment Securities or give up 18.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
KTB Investment Securities vs. SAMG Entertainment Co
Performance |
| Timeline |
| KTB Investment Securities |
| SAMG Entertainment |
KTB Investment and SAMG Entertainment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KTB Investment and SAMG Entertainment
The main advantage of trading using opposite KTB Investment and SAMG Entertainment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KTB Investment position performs unexpectedly, SAMG Entertainment 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 SAMG Entertainment will offset losses from the drop in SAMG Entertainment's long position.| KTB Investment vs. Samsung Electronics Co | KTB Investment vs. Samsung Electronics Co | KTB Investment vs. SK Hynix | KTB Investment vs. POSCO Holdings |
| SAMG Entertainment vs. Samsung Electronics Co | SAMG Entertainment vs. Samsung Electronics Co | SAMG Entertainment vs. LG Energy Solution | SAMG Entertainment vs. SK Hynix |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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