Correlation Between KB Financial and Dragonfly
Can any of the company-specific risk be diversified away by investing in both KB Financial and Dragonfly 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 Dragonfly 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 Dragonfly GF Co, you can compare the effects of market volatilities on KB Financial and Dragonfly 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 Dragonfly. Check out your portfolio center. Please also check ongoing floating volatility patterns of KB Financial and Dragonfly.
Diversification Opportunities for KB Financial and Dragonfly
-0.83 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between 105560 and Dragonfly is -0.83. Overlapping area represents the amount of risk that can be diversified away by holding KB Financial Group and Dragonfly GF Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dragonfly GF 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 Dragonfly. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dragonfly GF has no effect on the direction of KB Financial i.e., KB Financial and Dragonfly go up and down completely randomly.
Pair Corralation between KB Financial and Dragonfly
Assuming the 90 days trading horizon KB Financial Group is expected to generate 0.54 times more return on investment than Dragonfly. However, KB Financial Group is 1.85 times less risky than Dragonfly. It trades about 0.09 of its potential returns per unit of risk. Dragonfly GF Co is currently generating about -0.05 per unit of risk. If you would invest 4,963,251 in KB Financial Group on September 12, 2024 and sell it today you would earn a total of 3,366,749 from holding KB Financial Group or generate 67.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 93.72% |
| Values | Daily Returns |
KB Financial Group vs. Dragonfly GF Co
Performance |
| Timeline |
| KB Financial Group |
| Dragonfly GF |
KB Financial and Dragonfly Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KB Financial and Dragonfly
The main advantage of trading using opposite KB Financial and Dragonfly positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KB Financial position performs unexpectedly, Dragonfly 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 Dragonfly will offset losses from the drop in Dragonfly'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 |
| Dragonfly vs. Samsung Electronics Co | Dragonfly vs. Samsung Electronics Co | Dragonfly vs. LG Energy Solution | Dragonfly vs. SK Hynix |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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