Correlation Between KB Financial and Blackrock Multi

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

Diversification Opportunities for KB Financial and Blackrock Multi

-0.41
  Correlation Coefficient

Very good diversification

The 3 months correlation between KB Financial and Blackrock is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding KB Financial Group and Blackrock Multi Sector in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Multi Sector 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 Blackrock Multi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock Multi Sector has no effect on the direction of KB Financial i.e., KB Financial and Blackrock Multi go up and down completely randomly.

Pair Corralation between KB Financial and Blackrock Multi

Allowing for the 90-day total investment horizon KB Financial is expected to generate 2.67 times less return on investment than Blackrock Multi. In addition to that, KB Financial is 6.39 times more volatile than Blackrock Multi Sector. It trades about 0.0 of its total potential returns per unit of risk. Blackrock Multi Sector is currently generating about 0.04 per unit of volatility. If you would invest  1,464  in Blackrock Multi Sector on September 10, 2024 and sell it today you would earn a total of  16.00  from holding Blackrock Multi Sector or generate 1.09% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

KB Financial Group  vs.  Blackrock Multi Sector

 Performance 
       Timeline  
KB Financial Group 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
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 recent stock price disturbance, may contribute to short-term losses for the investors.
Blackrock Multi Sector 

Risk-Adjusted Performance

3 of 100

 
Weak
 
Strong
Weak
Compared to the overall equity markets, risk-adjusted returns on investments in Blackrock Multi Sector are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively stable forward indicators, Blackrock Multi is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

KB Financial and Blackrock Multi Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with KB Financial and Blackrock Multi

The main advantage of trading using opposite KB Financial and Blackrock Multi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KB Financial position performs unexpectedly, Blackrock Multi 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 Blackrock Multi will offset losses from the drop in Blackrock Multi's long position.
The idea behind KB Financial Group and Blackrock Multi Sector 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.

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