Correlation Between KakaoBank Corp and Samsung Life
Can any of the company-specific risk be diversified away by investing in both KakaoBank Corp and Samsung Life 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 KakaoBank Corp and Samsung Life into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KakaoBank Corp and Samsung Life Insurance, you can compare the effects of market volatilities on KakaoBank Corp and Samsung Life 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 KakaoBank Corp with a short position of Samsung Life. Check out your portfolio center. Please also check ongoing floating volatility patterns of KakaoBank Corp and Samsung Life.
Diversification Opportunities for KakaoBank Corp and Samsung Life
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between KakaoBank and Samsung is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding KakaoBank Corp and Samsung Life Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Samsung Life Insurance and KakaoBank Corp 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 KakaoBank Corp are associated (or correlated) with Samsung Life. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Samsung Life Insurance has no effect on the direction of KakaoBank Corp i.e., KakaoBank Corp and Samsung Life go up and down completely randomly.
Pair Corralation between KakaoBank Corp and Samsung Life
Assuming the 90 days trading horizon KakaoBank Corp is expected to under-perform the Samsung Life. In addition to that, KakaoBank Corp is 1.21 times more volatile than Samsung Life Insurance. It trades about -0.01 of its total potential returns per unit of risk. Samsung Life Insurance is currently generating about 0.04 per unit of volatility. If you would invest 6,837,387 in Samsung Life Insurance on October 17, 2024 and sell it today you would earn a total of 2,512,613 from holding Samsung Life Insurance or generate 36.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
KakaoBank Corp vs. Samsung Life Insurance
Performance |
| Timeline |
| KakaoBank Corp |
| Samsung Life Insurance |
KakaoBank Corp and Samsung Life Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KakaoBank Corp and Samsung Life
The main advantage of trading using opposite KakaoBank Corp and Samsung Life positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KakaoBank Corp position performs unexpectedly, Samsung Life 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 Samsung Life will offset losses from the drop in Samsung Life's long position.| KakaoBank Corp vs. DAEDUCK ELECTRONICS CoLtd | KakaoBank Corp vs. Kyeryong Construction Industrial | KakaoBank Corp vs. ABCO Electronics Co | KakaoBank Corp vs. ENERGYMACHINERY KOREA CoLtd |
| Samsung Life vs. Shinhan Inverse Copper | Samsung Life vs. Seoyon Topmetal Co | Samsung Life vs. Duksan Hi Metal | Samsung Life vs. Innowireless Co |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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