Correlation Between KB Financial and InfoBank
Can any of the company-specific risk be diversified away by investing in both KB Financial and InfoBank 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 InfoBank 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 InfoBank, you can compare the effects of market volatilities on KB Financial and InfoBank 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 InfoBank. Check out your portfolio center. Please also check ongoing floating volatility patterns of KB Financial and InfoBank.
Diversification Opportunities for KB Financial and InfoBank
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 105560 and InfoBank is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding KB Financial Group and InfoBank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on InfoBank 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 InfoBank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of InfoBank has no effect on the direction of KB Financial i.e., KB Financial and InfoBank go up and down completely randomly.
Pair Corralation between KB Financial and InfoBank
Assuming the 90 days trading horizon KB Financial is expected to generate 1.06 times less return on investment than InfoBank. But when comparing it to its historical volatility, KB Financial Group is 2.19 times less risky than InfoBank. It trades about 0.16 of its potential returns per unit of risk. InfoBank is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 796,000 in InfoBank on November 5, 2024 and sell it today you would earn a total of 28,000 from holding InfoBank or generate 3.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
KB Financial Group vs. InfoBank
Performance |
| Timeline |
| KB Financial Group |
| InfoBank |
KB Financial and InfoBank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KB Financial and InfoBank
The main advantage of trading using opposite KB Financial and InfoBank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KB Financial position performs unexpectedly, InfoBank 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 InfoBank will offset losses from the drop in InfoBank's long position.| KB Financial vs. Woori Technology | KB Financial vs. Chorokbaem Healthcare Co | KB Financial vs. KTB Investment Securities | KB Financial vs. iNtRON Biotechnology |
| InfoBank vs. Samsung Electronics Co | InfoBank vs. Samsung Electronics Co | InfoBank vs. Hyundai Motor Co | InfoBank vs. Hyundai Motor |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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