Correlation Between Shinsung Delta and KB Financial
Can any of the company-specific risk be diversified away by investing in both Shinsung Delta and KB Financial 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 Shinsung Delta and KB Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shinsung Delta Tech and KB Financial Group, you can compare the effects of market volatilities on Shinsung Delta and KB Financial 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 Shinsung Delta with a short position of KB Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shinsung Delta and KB Financial.
Diversification Opportunities for Shinsung Delta and KB Financial
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Shinsung and 105560 is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Shinsung Delta Tech and KB Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KB Financial Group and Shinsung Delta 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 Shinsung Delta Tech are associated (or correlated) with KB Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KB Financial Group has no effect on the direction of Shinsung Delta i.e., Shinsung Delta and KB Financial go up and down completely randomly.
Pair Corralation between Shinsung Delta and KB Financial
Assuming the 90 days trading horizon Shinsung Delta Tech is expected to generate 3.46 times more return on investment than KB Financial. However, Shinsung Delta is 3.46 times more volatile than KB Financial Group. It trades about 0.35 of its potential returns per unit of risk. KB Financial Group is currently generating about 0.13 per unit of risk. If you would invest 4,315,000 in Shinsung Delta Tech on September 2, 2024 and sell it today you would earn a total of 2,225,000 from holding Shinsung Delta Tech or generate 51.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shinsung Delta Tech vs. KB Financial Group
Performance |
| Timeline |
| Shinsung Delta Tech |
| KB Financial Group |
Shinsung Delta and KB Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shinsung Delta and KB Financial
The main advantage of trading using opposite Shinsung Delta and KB Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shinsung Delta position performs unexpectedly, KB Financial 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 KB Financial will offset losses from the drop in KB Financial's long position.| Shinsung Delta vs. Korea New Network | Shinsung Delta vs. ICD Co | Shinsung Delta vs. DYPNF CoLtd | Shinsung Delta vs. Busan Industrial Co |
| KB Financial vs. SS TECH | KB Financial vs. Eagle Veterinary Technology | KB Financial vs. Chin Yang Chemical | KB Financial vs. Shinsung Delta Tech |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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