Correlation Between SK Square and Kbi Metal
Can any of the company-specific risk be diversified away by investing in both SK Square and Kbi Metal 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 SK Square and Kbi Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SK Square Co and Kbi Metal Co, you can compare the effects of market volatilities on SK Square and Kbi Metal 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 SK Square with a short position of Kbi Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of SK Square and Kbi Metal.
Diversification Opportunities for SK Square and Kbi Metal
Significant diversification
The 3 months correlation between 402340 and Kbi is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding SK Square Co and Kbi Metal Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kbi Metal and SK Square 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 SK Square Co are associated (or correlated) with Kbi Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kbi Metal has no effect on the direction of SK Square i.e., SK Square and Kbi Metal go up and down completely randomly.
Pair Corralation between SK Square and Kbi Metal
Assuming the 90 days trading horizon SK Square Co is expected to generate 1.29 times more return on investment than Kbi Metal. However, SK Square is 1.29 times more volatile than Kbi Metal Co. It trades about -0.16 of its potential returns per unit of risk. Kbi Metal Co is currently generating about -0.4 per unit of risk. If you would invest 8,980,000 in SK Square Co on September 5, 2024 and sell it today you would lose (1,330,000) from holding SK Square Co or give up 14.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SK Square Co vs. Kbi Metal Co
Performance |
| Timeline |
| SK Square |
| Kbi Metal |
SK Square and Kbi Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SK Square and Kbi Metal
The main advantage of trading using opposite SK Square and Kbi Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SK Square position performs unexpectedly, Kbi Metal 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 Kbi Metal will offset losses from the drop in Kbi Metal's long position.| SK Square vs. Kbi Metal Co | SK Square vs. Jb Financial | SK Square vs. BNK Financial Group | SK Square vs. Jeju Bank |
| Kbi Metal vs. LG Chemicals | Kbi Metal vs. SM Entertainment Co | Kbi Metal vs. PJ Metal Co | Kbi Metal vs. Shinhan Inverse Copper |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
Other Complementary Tools
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges |