Correlation Between KB Financial and Anadolu Efes

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

Diversification Opportunities for KB Financial and Anadolu Efes

0.09

Correlation Coefficient

KB Financial  Anadolu Efes

Significant diversification

The 3 months correlation between KB Financial and Anadolu is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding KB Financial Group and Anadolu Efes Biracilik in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anadolu Efes Biracilik 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 Anadolu Efes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anadolu Efes Biracilik has no effect on the direction of KB Financial i.e., KB Financial and Anadolu Efes go up and down completely randomly.

Pair Corralation between KB Financial and Anadolu Efes

Allowing for the 90-day total investment horizon KB Financial Group is expected to generate 0.36 times more return on investment than Anadolu Efes. However, KB Financial Group is 2.76 times less risky than Anadolu Efes. It trades about -0.01 of its potential returns per unit of risk. Anadolu Efes Biracilik is currently generating about -0.1 per unit of risk. If you would invest  5,700  in KB Financial Group on December 28, 2024 and sell it today you would lose (106.00) from holding KB Financial Group or give up 1.86% of portfolio value over 90 days.

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

KB Financial Group  vs.  Anadolu Efes Biracilik

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 somewhat strong fundamental drivers, KB Financial is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Anadolu Efes Biracilik

Risk-Adjusted Performance

Very Weak

Over the last 90 days Anadolu Efes Biracilik has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Stock's basic indicators remain fairly 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.

Pair Trading with KB Financial and Anadolu Efes

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

The idea behind KB Financial Group and Anadolu Efes Biracilik 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.