Correlation Between KB Financial and Exploits Discovery

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

Diversification Opportunities for KB Financial and Exploits Discovery

-0.13

Correlation Coefficient

KB Financial  Exploits Discovery

Good diversification

The 3 months correlation between KB Financial and Exploits is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding KB Financial Group and Exploits Discovery Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Exploits Discovery Corp 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 Exploits Discovery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Exploits Discovery Corp has no effect on the direction of KB Financial i.e., KB Financial and Exploits Discovery go up and down completely randomly.

Pair Corralation between KB Financial and Exploits Discovery

Allowing for the 90-day total investment horizon KB Financial Group is expected to generate 0.44 times more return on investment than Exploits Discovery. However, KB Financial Group is 2.26 times less risky than Exploits Discovery. It trades about 0.0 of its potential returns per unit of risk. Exploits Discovery Corp is currently generating about -0.12 per unit of risk. If you would invest  6,137  in KB Financial Group on September 13, 2024 and sell it today you would lose (114.00) from holding KB Financial Group or give up 1.86% of portfolio value over 90 days.

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

KB Financial Group  vs.  Exploits Discovery Corp

KB Financial Group

Risk-Adjusted Performance

0 of 100

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.

Exploits Discovery Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Exploits Discovery Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's fundamental indicators remain nearly stable which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with KB Financial and Exploits Discovery

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

The idea behind KB Financial Group and Exploits Discovery Corp 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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.