Correlation Between KB Financial and Yinfu Gold

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

Diversification Opportunities for KB Financial and Yinfu Gold

0.0

Correlation Coefficient

KB Financial  Yinfu Gold

Pay attention - limited upside

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

Pair Corralation between KB Financial and Yinfu Gold

If you would invest  5,055  in KB Financial Group on February 3, 2024 and sell it today you would earn a total of  213.00  from holding KB Financial Group or generate 4.21% return on investment over 90 days.

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

KB Financial Group  vs.  Yinfu Gold

KB Financial Group

Risk-Adjusted Performance

5 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in KB Financial Group are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat unfluctuating fundamental drivers, KB Financial sustained solid returns over the last few months and may actually be approaching a breakup point.

Yinfu Gold

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Yinfu Gold has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Yinfu Gold is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with KB Financial and Yinfu Gold

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

The idea behind KB Financial Group and Yinfu Gold 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.