Correlation Between Kbi Metal and Kia Corp
Can any of the company-specific risk be diversified away by investing in both Kbi Metal and Kia Corp 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 Kia Corp 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 Kia Corp, you can compare the effects of market volatilities on Kbi Metal and Kia Corp 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 Kia Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kbi Metal and Kia Corp.
Diversification Opportunities for Kbi Metal and Kia Corp
Very weak diversification
The 3 months correlation between Kbi and Kia is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Kbi Metal Co and Kia Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kia Corp 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 Kia Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kia Corp has no effect on the direction of Kbi Metal i.e., Kbi Metal and Kia Corp go up and down completely randomly.
Pair Corralation between Kbi Metal and Kia Corp
Assuming the 90 days trading horizon Kbi Metal Co is expected to under-perform the Kia Corp. In addition to that, Kbi Metal is 2.18 times more volatile than Kia Corp. It trades about -0.1 of its total potential returns per unit of risk. Kia Corp is currently generating about -0.04 per unit of volatility. If you would invest 10,350,000 in Kia Corp on September 14, 2024 and sell it today you would lose (630,000) from holding Kia Corp or give up 6.09% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Kbi Metal Co vs. Kia Corp
Performance |
Timeline |
Kbi Metal |
Kia Corp |
Kbi Metal and Kia Corp Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Kbi Metal and Kia Corp
The main advantage of trading using opposite Kbi Metal and Kia Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kbi Metal position performs unexpectedly, Kia Corp 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 Kia Corp will offset losses from the drop in Kia Corp's long position.Kbi Metal vs. Daou Data Corp | Kbi Metal vs. Solution Advanced Technology | Kbi Metal vs. Busan Industrial Co | Kbi Metal vs. Busan Ind |
Kia Corp vs. Daou Data Corp | Kia Corp vs. Solution Advanced Technology | Kia Corp vs. Busan Industrial Co | Kia Corp vs. Busan Ind |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
Other Complementary Tools
Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
CEOs Directory Screen CEOs from public companies around the world | |
AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities |