Correlation Between Kukil Metal and KPX Green
Can any of the company-specific risk be diversified away by investing in both Kukil Metal and KPX Green 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 Kukil Metal and KPX Green into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kukil Metal Co and KPX Green Chemical, you can compare the effects of market volatilities on Kukil Metal and KPX Green 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 Kukil Metal with a short position of KPX Green. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kukil Metal and KPX Green.
Diversification Opportunities for Kukil Metal and KPX Green
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Kukil and KPX is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Kukil Metal Co and KPX Green Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KPX Green Chemical and Kukil Metal 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 Kukil Metal Co are associated (or correlated) with KPX Green. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KPX Green Chemical has no effect on the direction of Kukil Metal i.e., Kukil Metal and KPX Green go up and down completely randomly.
Pair Corralation between Kukil Metal and KPX Green
Assuming the 90 days trading horizon Kukil Metal is expected to generate 1.5 times less return on investment than KPX Green. But when comparing it to its historical volatility, Kukil Metal Co is 3.66 times less risky than KPX Green. It trades about 0.16 of its potential returns per unit of risk. KPX Green Chemical is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 636,294 in KPX Green Chemical on October 25, 2024 and sell it today you would earn a total of 25,706 from holding KPX Green Chemical or generate 4.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kukil Metal Co vs. KPX Green Chemical
Performance |
| Timeline |
| Kukil Metal |
| KPX Green Chemical |
Kukil Metal and KPX Green Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kukil Metal and KPX Green
The main advantage of trading using opposite Kukil Metal and KPX Green positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kukil Metal position performs unexpectedly, KPX Green 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 KPX Green will offset losses from the drop in KPX Green's long position.| Kukil Metal vs. Keum Kang Steel | Kukil Metal vs. PJ Metal Co | Kukil Metal vs. Samhyun Steel Co | Kukil Metal vs. Gyeongnam Steel Co |
| KPX Green vs. Kbi Metal Co | KPX Green vs. Kukil Metal Co | KPX Green vs. Formetal Co | KPX Green vs. Heungkuk Metaltech CoLtd |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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