Correlation Between KB Financial and ASPEN PHARUNADR
Can any of the company-specific risk be diversified away by investing in both KB Financial and ASPEN PHARUNADR 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 ASPEN PHARUNADR 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 ASPEN PHARUNADR 1, you can compare the effects of market volatilities on KB Financial and ASPEN PHARUNADR 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 ASPEN PHARUNADR. Check out your portfolio center. Please also check ongoing floating volatility patterns of KB Financial and ASPEN PHARUNADR.
Diversification Opportunities for KB Financial and ASPEN PHARUNADR
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between KBIA and ASPEN is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding KB Financial Group and ASPEN PHARUNADR 1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ASPEN PHARUNADR 1 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 ASPEN PHARUNADR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ASPEN PHARUNADR 1 has no effect on the direction of KB Financial i.e., KB Financial and ASPEN PHARUNADR go up and down completely randomly.
Pair Corralation between KB Financial and ASPEN PHARUNADR
Assuming the 90 days trading horizon KB Financial Group is expected to generate 1.22 times more return on investment than ASPEN PHARUNADR. However, KB Financial is 1.22 times more volatile than ASPEN PHARUNADR 1. It trades about 0.09 of its potential returns per unit of risk. ASPEN PHARUNADR 1 is currently generating about -0.07 per unit of risk. If you would invest 5,087 in KB Financial Group on September 2, 2024 and sell it today you would earn a total of 1,513 from holding KB Financial Group or generate 29.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
KB Financial Group vs. ASPEN PHARUNADR 1
Performance |
| Timeline |
| KB Financial Group |
| ASPEN PHARUNADR 1 |
KB Financial and ASPEN PHARUNADR Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KB Financial and ASPEN PHARUNADR
The main advantage of trading using opposite KB Financial and ASPEN PHARUNADR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KB Financial position performs unexpectedly, ASPEN PHARUNADR 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 ASPEN PHARUNADR will offset losses from the drop in ASPEN PHARUNADR's long position.| KB Financial vs. The Trade Desk | KB Financial vs. FLOW TRADERS LTD | KB Financial vs. Ultra Clean Holdings | KB Financial vs. Auto Trader Group |
| ASPEN PHARUNADR vs. Broadwind | ASPEN PHARUNADR vs. Universal Insurance Holdings | ASPEN PHARUNADR vs. Selective Insurance Group | ASPEN PHARUNADR vs. Gold Road Resources |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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