Correlation Between KB Financial and Hana Financial
Can any of the company-specific risk be diversified away by investing in both KB Financial and Hana Financial 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 Hana Financial 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 Hana Financial 7, you can compare the effects of market volatilities on KB Financial and Hana Financial 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 Hana Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of KB Financial and Hana Financial.
Diversification Opportunities for KB Financial and Hana Financial
-0.57 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between 105560 and Hana is -0.57. Overlapping area represents the amount of risk that can be diversified away by holding KB Financial Group and Hana Financial 7 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hana Financial 7 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 Hana Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hana Financial 7 has no effect on the direction of KB Financial i.e., KB Financial and Hana Financial go up and down completely randomly.
Pair Corralation between KB Financial and Hana Financial
Assuming the 90 days trading horizon KB Financial is expected to generate 4.84 times less return on investment than Hana Financial. But when comparing it to its historical volatility, KB Financial Group is 1.69 times less risky than Hana Financial. It trades about 0.03 of its potential returns per unit of risk. Hana Financial 7 is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,444,931 in Hana Financial 7 on October 30, 2024 and sell it today you would earn a total of 850,069 from holding Hana Financial 7 or generate 58.83% 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. Hana Financial 7
Performance |
| Timeline |
| KB Financial Group |
| Hana Financial 7 |
KB Financial and Hana Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KB Financial and Hana Financial
The main advantage of trading using opposite KB Financial and Hana Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KB Financial position performs unexpectedly, Hana Financial 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 Hana Financial will offset losses from the drop in Hana Financial's long position.| KB Financial vs. Bookook Steel | KB Financial vs. LEENO Industrial | KB Financial vs. BGF Retail Co | KB Financial vs. Industrial Bank |
| Hana Financial vs. Ananti Inc | Hana Financial vs. SS TECH | Hana Financial vs. Vieworks Co | Hana Financial vs. Shinsung Delta Tech |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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