Correlation Between Samsung Life and KakaoBank Corp
Can any of the company-specific risk be diversified away by investing in both Samsung Life and KakaoBank Corp 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 Samsung Life and KakaoBank Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Samsung Life Insurance and KakaoBank Corp, you can compare the effects of market volatilities on Samsung Life and KakaoBank Corp 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 Samsung Life with a short position of KakaoBank Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Samsung Life and KakaoBank Corp.
Diversification Opportunities for Samsung Life and KakaoBank Corp
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Samsung and KakaoBank is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Samsung Life Insurance and KakaoBank Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KakaoBank Corp and Samsung Life 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 Samsung Life Insurance are associated (or correlated) with KakaoBank Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KakaoBank Corp has no effect on the direction of Samsung Life i.e., Samsung Life and KakaoBank Corp go up and down completely randomly.
Pair Corralation between Samsung Life and KakaoBank Corp
Assuming the 90 days trading horizon Samsung Life Insurance is expected to under-perform the KakaoBank Corp. In addition to that, Samsung Life is 1.41 times more volatile than KakaoBank Corp. It trades about -0.48 of its total potential returns per unit of risk. KakaoBank Corp is currently generating about -0.08 per unit of volatility. If you would invest 2,105,000 in KakaoBank Corp on October 30, 2024 and sell it today you would lose (40,000) from holding KakaoBank Corp or give up 1.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Samsung Life Insurance vs. KakaoBank Corp
Performance |
| Timeline |
| Samsung Life Insurance |
| KakaoBank Corp |
Samsung Life and KakaoBank Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Samsung Life and KakaoBank Corp
The main advantage of trading using opposite Samsung Life and KakaoBank Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Samsung Life position performs unexpectedly, KakaoBank Corp 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 KakaoBank Corp will offset losses from the drop in KakaoBank Corp's long position.| Samsung Life vs. Youngchang Chemical Co | Samsung Life vs. Tae Kyung Chemical | Samsung Life vs. DB Insurance Co | Samsung Life vs. Dgb Financial |
| KakaoBank Corp vs. Shinhan Financial Group | KakaoBank Corp vs. Hana Financial | KakaoBank Corp vs. Woori Financial Group | KakaoBank Corp vs. Industrial Bank |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |