Correlation Between KB Financial and Plano Plano
Can any of the company-specific risk be diversified away by investing in both KB Financial and Plano Plano 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 Plano Plano 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 Plano Plano Desenvolvimento, you can compare the effects of market volatilities on KB Financial and Plano Plano 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 Plano Plano. Check out your portfolio center. Please also check ongoing floating volatility patterns of KB Financial and Plano Plano.
Diversification Opportunities for KB Financial and Plano Plano
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between K1BF34 and Plano is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding KB Financial Group and Plano Plano Desenvolvimento in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Plano Plano Desenvol 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 Plano Plano. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Plano Plano Desenvol has no effect on the direction of KB Financial i.e., KB Financial and Plano Plano go up and down completely randomly.
Pair Corralation between KB Financial and Plano Plano
Assuming the 90 days trading horizon KB Financial is expected to generate 1.54 times less return on investment than Plano Plano. But when comparing it to its historical volatility, KB Financial Group is 1.28 times less risky than Plano Plano. It trades about 0.05 of its potential returns per unit of risk. Plano Plano Desenvolvimento is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 437.00 in Plano Plano Desenvolvimento on October 12, 2024 and sell it today you would earn a total of 443.00 from holding Plano Plano Desenvolvimento or generate 101.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.79% |
| Values | Daily Returns |
KB Financial Group vs. Plano Plano Desenvolvimento
Performance |
| Timeline |
| KB Financial Group |
| Plano Plano Desenvol |
KB Financial and Plano Plano Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KB Financial and Plano Plano
The main advantage of trading using opposite KB Financial and Plano Plano positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KB Financial position performs unexpectedly, Plano Plano 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 Plano Plano will offset losses from the drop in Plano Plano's long position.| KB Financial vs. Taiwan Semiconductor Manufacturing | KB Financial vs. Apple Inc | KB Financial vs. Alibaba Group Holding | KB Financial vs. Banco Santander Chile |
| Plano Plano vs. Tyson Foods | Plano Plano vs. Broadridge Financial Solutions, | Plano Plano vs. KB Financial Group | Plano Plano vs. Credit Acceptance |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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