Correlation Between KB Financial and Synopex
Can any of the company-specific risk be diversified away by investing in both KB Financial and Synopex 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 Synopex 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 Synopex, you can compare the effects of market volatilities on KB Financial and Synopex 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 Synopex. Check out your portfolio center. Please also check ongoing floating volatility patterns of KB Financial and Synopex.
Diversification Opportunities for KB Financial and Synopex
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 105560 and Synopex is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding KB Financial Group and Synopex in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Synopex 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 Synopex. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Synopex has no effect on the direction of KB Financial i.e., KB Financial and Synopex go up and down completely randomly.
Pair Corralation between KB Financial and Synopex
Assuming the 90 days trading horizon KB Financial is expected to generate 1.34 times less return on investment than Synopex. But when comparing it to its historical volatility, KB Financial Group is 1.92 times less risky than Synopex. It trades about 0.08 of its potential returns per unit of risk. Synopex is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 375,714 in Synopex on September 12, 2024 and sell it today you would earn a total of 234,286 from holding Synopex or generate 62.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KB Financial Group vs. Synopex
Performance |
| Timeline |
| KB Financial Group |
| Synopex |
KB Financial and Synopex Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KB Financial and Synopex
The main advantage of trading using opposite KB Financial and Synopex positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KB Financial position performs unexpectedly, Synopex 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 Synopex will offset losses from the drop in Synopex's long position.| KB Financial vs. Shinhan Financial Group | KB Financial vs. Hana Financial | KB Financial vs. Woori Financial Group | KB Financial vs. Samsung Electronics Co |
| Synopex vs. Infinitt Healthcare Co | Synopex vs. Mgame Corp | Synopex vs. Netmarble Games Corp | Synopex vs. Next Entertainment World |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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