Correlation Between Kbi Metal and Dongil Metal
Can any of the company-specific risk be diversified away by investing in both Kbi Metal and Dongil Metal 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 Kbi Metal and Dongil Metal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kbi Metal Co and Dongil Metal Co, you can compare the effects of market volatilities on Kbi Metal and Dongil Metal 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 Kbi Metal with a short position of Dongil Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kbi Metal and Dongil Metal.
Diversification Opportunities for Kbi Metal and Dongil Metal
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Kbi and Dongil is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Kbi Metal Co and Dongil Metal Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongil Metal and Kbi Metal 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 Kbi Metal Co are associated (or correlated) with Dongil Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongil Metal has no effect on the direction of Kbi Metal i.e., Kbi Metal and Dongil Metal go up and down completely randomly.
Pair Corralation between Kbi Metal and Dongil Metal
Assuming the 90 days trading horizon Kbi Metal Co is expected to generate 6.79 times more return on investment than Dongil Metal. However, Kbi Metal is 6.79 times more volatile than Dongil Metal Co. It trades about 0.05 of its potential returns per unit of risk. Dongil Metal Co is currently generating about -0.07 per unit of risk. If you would invest 147,500 in Kbi Metal Co on September 25, 2024 and sell it today you would earn a total of 57,000 from holding Kbi Metal Co or generate 38.64% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Kbi Metal Co vs. Dongil Metal Co
Performance |
Timeline |
Kbi Metal |
Dongil Metal |
Kbi Metal and Dongil Metal Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Kbi Metal and Dongil Metal
The main advantage of trading using opposite Kbi Metal and Dongil Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kbi Metal position performs unexpectedly, Dongil Metal 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 Dongil Metal will offset losses from the drop in Dongil Metal's long position.Kbi Metal vs. Woori Technology Investment | Kbi Metal vs. Samsung Card Co | Kbi Metal vs. Korea Real Estate | Kbi Metal vs. CHOROKBAEM PANY Co |
Dongil Metal vs. Daejung Chemicals Metals | Dongil Metal vs. Kakao Games Corp | Dongil Metal vs. Jeju Air Co | Dongil Metal vs. Genie Music |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
Other Complementary Tools
Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital | |
Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |