Correlation Between KB Financial and Trucept

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

Diversification Opportunities for KB Financial and Trucept

-0.84

Correlation Coefficient

KB Financial  Trucept

Pay attention - limited upside

The 3 months correlation between KB Financial and Trucept is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding KB Financial Group and Trucept in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trucept 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 Trucept. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trucept has no effect on the direction of KB Financial i.e., KB Financial and Trucept go up and down completely randomly.

Pair Corralation between KB Financial and Trucept

Allowing for the 90-day total investment horizon KB Financial Group is expected to generate 0.37 times more return on investment than Trucept. However, KB Financial Group is 2.68 times less risky than Trucept. It trades about 0.24 of its potential returns per unit of risk. Trucept is currently generating about -0.03 per unit of risk. If you would invest  6,034  in KB Financial Group on April 27, 2025 and sell it today you would earn a total of  2,557  from holding KB Financial Group or generate 42.38% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	98.41%
Values	Daily Returns

KB Financial Group  vs.  Trucept

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.

Trucept

Risk-Adjusted Performance

Very Weak

Over the last 90 days Trucept has generated negative risk-adjusted returns adding no value to investors with long positions. Even with fragile performance in the last few months, the Stock's technical and fundamental indicators remain relatively invariable which may send shares a bit higher in August 2025. The latest agitation may also be a sign of long-running up-swing for the enterprise retail investors.

Pair Trading with KB Financial and Trucept

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

The idea behind KB Financial Group and Trucept 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.