Correlation Between KB Financial and Entera Bio
Can any of the company-specific risk be diversified away by investing in both KB Financial and Entera Bio 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 Entera Bio 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 Entera Bio, you can compare the effects of market volatilities on KB Financial and Entera Bio 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 Entera Bio. Check out your portfolio center. Please also check ongoing floating volatility patterns of KB Financial and Entera Bio.
Diversification Opportunities for KB Financial and Entera Bio
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between KB Financial and Entera is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding KB Financial Group and Entera Bio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Entera Bio 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 Entera Bio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Entera Bio has no effect on the direction of KB Financial i.e., KB Financial and Entera Bio go up and down completely randomly.
Pair Corralation between KB Financial and Entera Bio
If you would invest 6,696 in KB Financial Group on August 25, 2024 and sell it today you would earn a total of 297.00 from holding KB Financial Group or generate 4.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
KB Financial Group vs. Entera Bio
Performance |
| Timeline |
| KB Financial Group |
| Entera Bio |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
KB Financial and Entera Bio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KB Financial and Entera Bio
The main advantage of trading using opposite KB Financial and Entera Bio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KB Financial position performs unexpectedly, Entera Bio 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 Entera Bio will offset losses from the drop in Entera Bio's long position.| KB Financial vs. Banco Bradesco SA | KB Financial vs. Itau Unibanco Banco | KB Financial vs. Banco Santander Brasil | KB Financial vs. Western Alliance Bancorporation |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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