Correlation Between KB Financial and Global Standard
Can any of the company-specific risk be diversified away by investing in both KB Financial and Global Standard 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 Global Standard 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 Global Standard Technology, you can compare the effects of market volatilities on KB Financial and Global Standard 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 Global Standard. Check out your portfolio center. Please also check ongoing floating volatility patterns of KB Financial and Global Standard.
Diversification Opportunities for KB Financial and Global Standard
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 105560 and Global is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding KB Financial Group and Global Standard Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Standard Tech 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 Global Standard. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Standard Tech has no effect on the direction of KB Financial i.e., KB Financial and Global Standard go up and down completely randomly.
Pair Corralation between KB Financial and Global Standard
Assuming the 90 days trading horizon KB Financial is expected to generate 1.71 times less return on investment than Global Standard. But when comparing it to its historical volatility, KB Financial Group is 1.36 times less risky than Global Standard. It trades about 0.08 of its potential returns per unit of risk. Global Standard Technology is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,308,900 in Global Standard Technology on November 3, 2024 and sell it today you would earn a total of 487,100 from holding Global Standard Technology or generate 37.21% 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. Global Standard Technology
Performance |
| Timeline |
| KB Financial Group |
| Global Standard Tech |
KB Financial and Global Standard Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KB Financial and Global Standard
The main advantage of trading using opposite KB Financial and Global Standard positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KB Financial position performs unexpectedly, Global Standard 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 Global Standard will offset losses from the drop in Global Standard's long position.| KB Financial vs. Daechang Steel Co | KB Financial vs. Daehan Steel | KB Financial vs. Dongbang Transport Logistics | KB Financial vs. Dongil Metal Co |
| Global Standard vs. Samsung Electronics Co | Global Standard vs. Samsung Electronics Co | Global Standard vs. Hyundai Motor Co | Global Standard 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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