Correlation Between KB Financial and RadNet
Can any of the company-specific risk be diversified away by investing in both KB Financial and RadNet 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 RadNet 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 RadNet Inc, you can compare the effects of market volatilities on KB Financial and RadNet 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 RadNet. Check out your portfolio center. Please also check ongoing floating volatility patterns of KB Financial and RadNet.
Diversification Opportunities for KB Financial and RadNet
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between KB Financial and RadNet is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding KB Financial Group and RadNet Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RadNet Inc 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 RadNet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RadNet Inc has no effect on the direction of KB Financial i.e., KB Financial and RadNet go up and down completely randomly.
Pair Corralation between KB Financial and RadNet
Allowing for the 90-day total investment horizon KB Financial Group is expected to generate 1.07 times more return on investment than RadNet. However, KB Financial is 1.07 times more volatile than RadNet Inc. It trades about 0.26 of its potential returns per unit of risk. RadNet Inc is currently generating about 0.12 per unit of risk. If you would invest 5,860 in KB Financial Group on April 23, 2025 and sell it today you would earn a total of 2,435 from holding KB Financial Group or generate 41.55% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
KB Financial Group vs. RadNet Inc
Performance |
Timeline |
KB Financial Group |
RadNet Inc |
KB Financial and RadNet Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with KB Financial and RadNet
The main advantage of trading using opposite KB Financial and RadNet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KB Financial position performs unexpectedly, RadNet 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 RadNet will offset losses from the drop in RadNet's long position.KB Financial vs. Shinhan Financial Group | KB Financial vs. Woori Financial Group | KB Financial vs. Korea Electric Power | KB Financial vs. Orix Corp Ads |
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Check out your portfolio center.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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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