Correlation Between KBC GROEP and KBC Group

Can any of the company-specific risk be diversified away by investing in both KBC GROEP and KBC Group 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 KBC GROEP and KBC Group into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between KBC GROEP NV and KBC Group NV, you can compare the effects of market volatilities on KBC GROEP and KBC Group 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 KBC GROEP with a short position of KBC Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of KBC GROEP and KBC Group.

Diversification Opportunities for KBC GROEP and KBC Group

0.0

Correlation Coefficient

KBC GROEP  KBC Group

Pay attention - limited upside

The 3 months correlation between KBC and KBC is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding KBC GROEP NV and KBC Group NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KBC Group NV and KBC GROEP 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 KBC GROEP NV are associated (or correlated) with KBC Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KBC Group NV has no effect on the direction of KBC GROEP i.e., KBC GROEP and KBC Group go up and down completely randomly.

Pair Corralation between KBC GROEP and KBC Group

If you would invest  6,954  in KBC Group NV on October 7, 2024 and sell it today you would earn a total of  466.00  from holding KBC Group NV or generate 6.7% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	5.88%
Values	Daily Returns

KBC GROEP NV  vs.  KBC Group NV

KBC GROEP NV

Risk-Adjusted Performance

0 of 100

OK

Over the last 90 days KBC GROEP NV has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable fundamental drivers, KBC GROEP is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

KBC Group NV

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in KBC Group NV are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady basic indicators, KBC Group may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with KBC GROEP and KBC Group

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

The idea behind KBC GROEP NV and KBC Group NV 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.