Correlation Between KT and Anterix

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

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

Diversification Opportunities for KT and Anterix

0.6

Correlation Coefficient

KT  Anterix

Poor diversification

The 3 months correlation between KT and Anterix is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding KT Corp. and Anterix in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anterix and KT 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 KT Corporation are associated (or correlated) with Anterix. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anterix has no effect on the direction of KT i.e., KT and Anterix go up and down completely randomly.

Pair Corralation between KT and Anterix

Allowing for the 90-day total investment horizon KT is expected to generate 2.01 times less return on investment than Anterix. But when comparing it to its historical volatility, KT Corporation is 3.31 times less risky than Anterix. It trades about 0.15 of its potential returns per unit of risk. Anterix is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  3,074  in Anterix on December 27, 2024 and sell it today you would earn a total of  663.00  from holding Anterix or generate 21.57% return on investment over 90 days.

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

KT Corp.  vs.  Anterix

KT Corporation

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in KT Corporation are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively inconsistent basic indicators, KT unveiled solid returns over the last few months and may actually be approaching a breakup point.

Anterix

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Anterix are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of fairly unfluctuating technical and fundamental indicators, Anterix showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with KT and Anterix

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

The idea behind KT Corporation and Anterix 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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.