Correlation Between KB Financial and Sajo Seafood
Can any of the company-specific risk be diversified away by investing in both KB Financial and Sajo Seafood 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 KB Financial and Sajo Seafood into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KB Financial Group and Sajo Seafood, you can compare the effects of market volatilities on KB Financial and Sajo Seafood 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 KB Financial with a short position of Sajo Seafood. Check out your portfolio center. Please also check ongoing floating volatility patterns of KB Financial and Sajo Seafood.
Diversification Opportunities for KB Financial and Sajo Seafood
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between 105560 and Sajo is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding KB Financial Group and Sajo Seafood in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sajo Seafood and KB Financial 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 KB Financial Group are associated (or correlated) with Sajo Seafood. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sajo Seafood has no effect on the direction of KB Financial i.e., KB Financial and Sajo Seafood go up and down completely randomly.
Pair Corralation between KB Financial and Sajo Seafood
Assuming the 90 days trading horizon KB Financial is expected to generate 1.53 times less return on investment than Sajo Seafood. But when comparing it to its historical volatility, KB Financial Group is 1.9 times less risky than Sajo Seafood. It trades about 0.07 of its potential returns per unit of risk. Sajo Seafood is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 332,000 in Sajo Seafood on October 12, 2024 and sell it today you would earn a total of 126,000 from holding Sajo Seafood or generate 37.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KB Financial Group vs. Sajo Seafood
Performance |
| Timeline |
| KB Financial Group |
| Sajo Seafood |
KB Financial and Sajo Seafood Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KB Financial and Sajo Seafood
The main advantage of trading using opposite KB Financial and Sajo Seafood positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KB Financial position performs unexpectedly, Sajo Seafood 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 Sajo Seafood will offset losses from the drop in Sajo Seafood's long position.| KB Financial vs. Korean Air Lines | KB Financial vs. Dgb Financial | KB Financial vs. BNK Financial Group | KB Financial vs. Hanjoo Light Metal |
| Sajo Seafood vs. Samsung Electronics Co | Sajo Seafood vs. Samsung Electronics Co | Sajo Seafood vs. KB Financial Group | Sajo Seafood vs. Shinhan Financial Group |
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 CEOs Directory module to screen CEOs from public companies around the world.
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