Correlation Between KB Financial and TSI
Can any of the company-specific risk be diversified away by investing in both KB Financial and TSI 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 TSI 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 TSI Co, you can compare the effects of market volatilities on KB Financial and TSI 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 TSI. Check out your portfolio center. Please also check ongoing floating volatility patterns of KB Financial and TSI.
Diversification Opportunities for KB Financial and TSI
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between 105560 and TSI is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding KB Financial Group and TSI Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TSI Co 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 TSI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TSI Co has no effect on the direction of KB Financial i.e., KB Financial and TSI go up and down completely randomly.
Pair Corralation between KB Financial and TSI
Assuming the 90 days trading horizon KB Financial Group is expected to generate 1.05 times more return on investment than TSI. However, KB Financial is 1.05 times more volatile than TSI Co. It trades about 0.12 of its potential returns per unit of risk. TSI Co is currently generating about -0.07 per unit of risk. If you would invest 4,859,259 in KB Financial Group on September 2, 2024 and sell it today you would earn a total of 4,760,741 from holding KB Financial Group or generate 97.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KB Financial Group vs. TSI Co
Performance |
| Timeline |
| KB Financial Group |
| TSI Co |
KB Financial and TSI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KB Financial and TSI
The main advantage of trading using opposite KB Financial and TSI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KB Financial position performs unexpectedly, TSI 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 TSI will offset losses from the drop in TSI'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 |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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