Correlation Between KB Financial and JPMorgan Chase
Can any of the company-specific risk be diversified away by investing in both KB Financial and JPMorgan Chase 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 JPMorgan Chase 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 JPMorgan Chase Co, you can compare the effects of market volatilities on KB Financial and JPMorgan Chase 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 JPMorgan Chase. Check out your portfolio center. Please also check ongoing floating volatility patterns of KB Financial and JPMorgan Chase.
Diversification Opportunities for KB Financial and JPMorgan Chase
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between KB Financial and JPMorgan is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding KB Financial Group and JPMorgan Chase Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on JPMorgan Chase 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 JPMorgan Chase. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of JPMorgan Chase has no effect on the direction of KB Financial i.e., KB Financial and JPMorgan Chase go up and down completely randomly.
Pair Corralation between KB Financial and JPMorgan Chase
Allowing for the 90-day total investment horizon KB Financial is expected to generate 3.88 times less return on investment than JPMorgan Chase. But when comparing it to its historical volatility, KB Financial Group is 1.64 times less risky than JPMorgan Chase. It trades about 0.08 of its potential returns per unit of risk. JPMorgan Chase Co is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 22,290 in JPMorgan Chase Co on August 30, 2024 and sell it today you would earn a total of 2,689 from holding JPMorgan Chase Co or generate 12.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
KB Financial Group vs. JPMorgan Chase Co
Performance |
| Timeline |
| KB Financial Group |
| JPMorgan Chase |
KB Financial and JPMorgan Chase Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KB Financial and JPMorgan Chase
The main advantage of trading using opposite KB Financial and JPMorgan Chase positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KB Financial position performs unexpectedly, JPMorgan Chase 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 JPMorgan Chase will offset losses from the drop in JPMorgan Chase's long position.| KB Financial vs. JPMorgan Chase Co | KB Financial vs. Citigroup | KB Financial vs. Wells Fargo | KB Financial vs. Toronto Dominion Bank |
| JPMorgan Chase vs. Citigroup | JPMorgan Chase vs. Wells Fargo | JPMorgan Chase vs. Royal Bank of | JPMorgan Chase vs. Nu Holdings |
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 Stocks Directory module to find actively traded stocks across global markets.
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