Correlation Between Value Added and Kbi Metal
Can any of the company-specific risk be diversified away by investing in both Value Added and Kbi Metal 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 Value Added and Kbi Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Value Added Technology and Kbi Metal Co, you can compare the effects of market volatilities on Value Added and Kbi Metal 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 Value Added with a short position of Kbi Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Value Added and Kbi Metal.
Diversification Opportunities for Value Added and Kbi Metal
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Value and Kbi is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Value Added Technology and Kbi Metal Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kbi Metal and Value Added 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 Value Added Technology are associated (or correlated) with Kbi Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kbi Metal has no effect on the direction of Value Added i.e., Value Added and Kbi Metal go up and down completely randomly.
Pair Corralation between Value Added and Kbi Metal
Assuming the 90 days trading horizon Value Added Technology is expected to under-perform the Kbi Metal. But the stock apears to be less risky and, when comparing its historical volatility, Value Added Technology is 2.12 times less risky than Kbi Metal. The stock trades about -0.03 of its potential returns per unit of risk. The Kbi Metal Co is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 144,500 in Kbi Metal Co on September 2, 2024 and sell it today you would earn a total of 52,500 from holding Kbi Metal Co or generate 36.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Value Added Technology vs. Kbi Metal Co
Performance |
| Timeline |
| Value Added Technology |
| Kbi Metal |
Value Added and Kbi Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Value Added and Kbi Metal
The main advantage of trading using opposite Value Added and Kbi Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Value Added position performs unexpectedly, Kbi Metal 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 Kbi Metal will offset losses from the drop in Kbi Metal's long position.| Value Added vs. AptaBio Therapeutics | Value Added vs. KT Hitel | Value Added vs. SillaJen | Value Added vs. Cytogen |
| Kbi Metal vs. LG Display | Kbi Metal vs. Hyundai Motor Co | Kbi Metal vs. Hyundai Motor Co | Kbi Metal vs. Adaptive Plasma Technology |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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