Correlation Between KB Financial and A Tech
Can any of the company-specific risk be diversified away by investing in both KB Financial and A Tech 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 A Tech 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 A Tech Solution Co, you can compare the effects of market volatilities on KB Financial and A Tech 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 A Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of KB Financial and A Tech.
Diversification Opportunities for KB Financial and A Tech
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between 105560 and 071670 is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding KB Financial Group and A Tech Solution Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on A Tech Solution 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 A Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of A Tech Solution has no effect on the direction of KB Financial i.e., KB Financial and A Tech go up and down completely randomly.
Pair Corralation between KB Financial and A Tech
Assuming the 90 days trading horizon KB Financial Group is expected to generate 0.77 times more return on investment than A Tech. However, KB Financial Group is 1.3 times less risky than A Tech. It trades about 0.37 of its potential returns per unit of risk. A Tech Solution Co is currently generating about -0.2 per unit of risk. If you would invest 8,550,000 in KB Financial Group on November 5, 2024 and sell it today you would earn a total of 620,000 from holding KB Financial Group or generate 7.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KB Financial Group vs. A Tech Solution Co
Performance |
| Timeline |
| KB Financial Group |
| A Tech Solution |
KB Financial and A Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KB Financial and A Tech
The main advantage of trading using opposite KB Financial and A Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KB Financial position performs unexpectedly, A Tech 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 A Tech will offset losses from the drop in A Tech'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 |
| A Tech vs. Samsung Card Co | A Tech vs. EBEST Investment Securities | A Tech vs. Koh Young Technology | A Tech vs. Hansol Chemica |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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