Correlation Between KB Financial and Q Capital

Can any of the company-specific risk be diversified away by investing in both KB Financial and Q Capital 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 Q Capital 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 Q Capital Partners, you can compare the effects of market volatilities on KB Financial and Q Capital 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 Q Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of KB Financial and Q Capital.

Diversification Opportunities for KB Financial and Q Capital

-0.11

Correlation Coefficient

KB Financial  Q Capital

Good diversification

The 3 months correlation between 105560 and 016600 is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding KB Financial Group and Q Capital Partners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Q Capital Partners 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 Q Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Q Capital Partners has no effect on the direction of KB Financial i.e., KB Financial and Q Capital go up and down completely randomly.

Pair Corralation between KB Financial and Q Capital

Assuming the 90 days trading horizon KB Financial Group is expected to under-perform the Q Capital. In addition to that, KB Financial is 1.02 times more volatile than Q Capital Partners. It trades about -0.07 of its total potential returns per unit of risk. Q Capital Partners is currently generating about 0.12 per unit of volatility. If you would invest  26,600  in Q Capital Partners on December 2, 2024 and sell it today you would earn a total of  2,100  from holding Q Capital Partners or generate 7.89% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

KB Financial Group  vs.  Q Capital Partners

KB Financial Group

Risk-Adjusted Performance

Very Weak

Over the last 90 days KB Financial Group has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Q Capital Partners

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Q Capital Partners are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Q Capital sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with KB Financial and Q Capital

The main advantage of trading using opposite KB Financial and Q Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KB Financial position performs unexpectedly, Q Capital 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 Q Capital will offset losses from the drop in Q Capital's long position.

The idea behind KB Financial Group and Q Capital Partners pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.