Correlation Between Intercorp Financial and KB Financial
Can any of the company-specific risk be diversified away by investing in both Intercorp Financial and KB 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 Intercorp Financial and KB Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intercorp Financial Services and KB Financial Group, you can compare the effects of market volatilities on Intercorp Financial and KB 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 Intercorp Financial with a short position of KB Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intercorp Financial and KB Financial.
Diversification Opportunities for Intercorp Financial and KB Financial
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Intercorp and KB Financial is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Intercorp Financial Services and KB Financial Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KB Financial Group and Intercorp 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 Intercorp Financial Services are associated (or correlated) with KB Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KB Financial Group has no effect on the direction of Intercorp Financial i.e., Intercorp Financial and KB Financial go up and down completely randomly.
Pair Corralation between Intercorp Financial and KB Financial
Considering the 90-day investment horizon Intercorp Financial Services is expected to under-perform the KB Financial. But the stock apears to be less risky and, when comparing its historical volatility, Intercorp Financial Services is 1.23 times less risky than KB Financial. The stock trades about -0.19 of its potential returns per unit of risk. The KB Financial Group is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 5,940 in KB Financial Group on October 14, 2024 and sell it today you would lose (36.00) from holding KB Financial Group or give up 0.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intercorp Financial Services vs. KB Financial Group
Performance |
| Timeline |
| Intercorp Financial |
| KB Financial Group |
Intercorp Financial and KB Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intercorp Financial and KB Financial
The main advantage of trading using opposite Intercorp Financial and KB Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intercorp Financial position performs unexpectedly, KB 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 KB Financial will offset losses from the drop in KB Financial's long position.| Intercorp Financial vs. Banco De Chile | Intercorp Financial vs. Bancolombia SA ADR | Intercorp Financial vs. Foreign Trade Bank | Intercorp Financial vs. BancFirst |
| KB Financial vs. Banco De Chile | KB Financial vs. Banco Santander Chile | KB Financial vs. Intercorp Financial Services | KB Financial vs. Credicorp |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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