Correlation Between KB Financial and G6 Materials

Can any of the company-specific risk be diversified away by investing in both KB Financial and G6 Materials 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 G6 Materials 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 G6 Materials Corp, you can compare the effects of market volatilities on KB Financial and G6 Materials 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 G6 Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of KB Financial and G6 Materials.

Diversification Opportunities for KB Financial and G6 Materials

-0.75

Correlation Coefficient

KB Financial  G6 Materials

Pay attention - limited upside

The 3 months correlation between KB Financial and GPHBF is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding KB Financial Group and G6 Materials Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on G6 Materials 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 G6 Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of G6 Materials Corp has no effect on the direction of KB Financial i.e., KB Financial and G6 Materials go up and down completely randomly.

Pair Corralation between KB Financial and G6 Materials

Allowing for the 90-day total investment horizon KB Financial is expected to generate 63.45 times less return on investment than G6 Materials. But when comparing it to its historical volatility, KB Financial Group is 66.27 times less risky than G6 Materials. It trades about 0.15 of its potential returns per unit of risk. G6 Materials Corp is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  10.00  in G6 Materials Corp on May 9, 2025 and sell it today you would lose (9.99) from holding G6 Materials Corp or give up 99.9% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.39%
Values	Daily Returns

KB Financial Group  vs.  G6 Materials Corp

KB Financial Group

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in KB Financial Group are ranked lower than 12 (%) 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.

G6 Materials Corp

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in G6 Materials Corp are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile fundamental drivers, G6 Materials reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with KB Financial and G6 Materials

The main advantage of trading using opposite KB Financial and G6 Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KB Financial position performs unexpectedly, G6 Materials 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 G6 Materials will offset losses from the drop in G6 Materials' long position.

The idea behind KB Financial Group and G6 Materials 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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.