Correlation Between KB Financial and KOOL2PLAY
Can any of the company-specific risk be diversified away by investing in both KB Financial and KOOL2PLAY 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 KOOL2PLAY 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 KOOL2PLAY SA ZY, you can compare the effects of market volatilities on KB Financial and KOOL2PLAY 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 KOOL2PLAY. Check out your portfolio center. Please also check ongoing floating volatility patterns of KB Financial and KOOL2PLAY.
Diversification Opportunities for KB Financial and KOOL2PLAY
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between KBIA and KOOL2PLAY is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding KB Financial Group and KOOL2PLAY SA ZY in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KOOL2PLAY SA ZY 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 KOOL2PLAY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KOOL2PLAY SA ZY has no effect on the direction of KB Financial i.e., KB Financial and KOOL2PLAY go up and down completely randomly.
Pair Corralation between KB Financial and KOOL2PLAY
Assuming the 90 days trading horizon KB Financial Group is expected to generate 0.38 times more return on investment than KOOL2PLAY. However, KB Financial Group is 2.65 times less risky than KOOL2PLAY. It trades about 0.07 of its potential returns per unit of risk. KOOL2PLAY SA ZY is currently generating about -0.02 per unit of risk. If you would invest 3,305 in KB Financial Group on August 24, 2024 and sell it today you would earn a total of 3,245 from holding KB Financial Group or generate 98.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KB Financial Group vs. KOOL2PLAY SA ZY
Performance |
| Timeline |
| KB Financial Group |
| KOOL2PLAY SA ZY |
KB Financial and KOOL2PLAY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KB Financial and KOOL2PLAY
The main advantage of trading using opposite KB Financial and KOOL2PLAY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KB Financial position performs unexpectedly, KOOL2PLAY 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 KOOL2PLAY will offset losses from the drop in KOOL2PLAY's long position.| KB Financial vs. HDFC Bank Limited | KB Financial vs. PT Bank Central | KB Financial vs. DBS Group Holdings | KB Financial vs. State Bank of |
| KOOL2PLAY vs. TYSON FOODS A | KOOL2PLAY vs. MeVis Medical Solutions | KOOL2PLAY vs. Food Life Companies | KOOL2PLAY vs. Advanced Medical Solutions |
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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