Correlation Between KB Financial and Daou Data
Can any of the company-specific risk be diversified away by investing in both KB Financial and Daou Data 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 Daou Data 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 Daou Data Corp, you can compare the effects of market volatilities on KB Financial and Daou Data 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 Daou Data. Check out your portfolio center. Please also check ongoing floating volatility patterns of KB Financial and Daou Data.
Diversification Opportunities for KB Financial and Daou Data
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between 105560 and Daou is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding KB Financial Group and Daou Data Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Daou Data Corp 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 Daou Data. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Daou Data Corp has no effect on the direction of KB Financial i.e., KB Financial and Daou Data go up and down completely randomly.
Pair Corralation between KB Financial and Daou Data
Assuming the 90 days trading horizon KB Financial Group is expected to generate 1.6 times more return on investment than Daou Data. However, KB Financial is 1.6 times more volatile than Daou Data Corp. It trades about 0.13 of its potential returns per unit of risk. Daou Data Corp is currently generating about -0.05 per unit of risk. If you would invest 9,180,000 in KB Financial Group on September 2, 2024 and sell it today you would earn a total of 440,000 from holding KB Financial Group or generate 4.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
KB Financial Group vs. Daou Data Corp
Performance |
| Timeline |
| KB Financial Group |
| Daou Data Corp |
KB Financial and Daou Data Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KB Financial and Daou Data
The main advantage of trading using opposite KB Financial and Daou Data positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KB Financial position performs unexpectedly, Daou Data 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 Daou Data will offset losses from the drop in Daou Data's long position.| KB Financial vs. SS TECH | KB Financial vs. Eagle Veterinary Technology | KB Financial vs. Chin Yang Chemical | KB Financial vs. Shinsung Delta Tech |
| Daou Data vs. Samsung Electronics Co | Daou Data vs. Samsung Electronics Co | Daou Data vs. KB Financial Group | Daou Data 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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