Correlation Between KB Financial and Core One

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

Diversification Opportunities for KB Financial and Core One

-0.36

Correlation Coefficient

KB Financial  Core One

Very good diversification

The 3 months correlation between KB Financial and Core is -0.36. Overlapping area represents the amount of risk that can be diversified away by holding KB Financial Group and Core One Labs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Core One Labs 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 Core One. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Core One Labs has no effect on the direction of KB Financial i.e., KB Financial and Core One go up and down completely randomly.

Pair Corralation between KB Financial and Core One

Allowing for the 90-day total investment horizon KB Financial is expected to generate 59.58 times less return on investment than Core One. But when comparing it to its historical volatility, KB Financial Group is 58.59 times less risky than Core One. It trades about 0.24 of its potential returns per unit of risk. Core One Labs is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest  6.25  in Core One Labs on April 28, 2025 and sell it today you would lose (0.47) from holding Core One Labs or give up 7.52% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

KB Financial Group  vs.  Core One Labs

KB Financial Group

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in KB Financial Group are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. Despite somewhat fragile fundamental drivers, KB Financial sustained solid returns over the last few months and may actually be approaching a breakup point.

Core One Labs

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Core One Labs are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. Despite nearly unsteady fundamental drivers, Core One reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with KB Financial and Core One

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

The idea behind KB Financial Group and Core One Labs 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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.