Correlation Between Comcast Corp and KT

Can any of the company-specific risk be diversified away by investing in both Comcast Corp and KT 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 Comcast Corp and KT into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Comcast Corp and KT Corporation, you can compare the effects of market volatilities on Comcast Corp and KT 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 Comcast Corp with a short position of KT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Comcast Corp and KT.

Diversification Opportunities for Comcast Corp and KT

0.41

Correlation Coefficient

Comcast Corp  KT

Very weak diversification

The 3 months correlation between Comcast and KT is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Comcast Corp and KT Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KT Corporation and Comcast Corp 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 Comcast Corp are associated (or correlated) with KT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KT Corporation has no effect on the direction of Comcast Corp i.e., Comcast Corp and KT go up and down completely randomly.

Pair Corralation between Comcast Corp and KT

Assuming the 90 days horizon Comcast Corp is expected to generate 1.23 times more return on investment than KT. However, Comcast Corp is 1.23 times more volatile than KT Corporation. It trades about 0.0 of its potential returns per unit of risk. KT Corporation is currently generating about -0.01 per unit of risk. If you would invest  4,040  in Comcast Corp on January 29, 2024 and sell it today you would lose (183.00) from holding Comcast Corp or give up 4.53% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	99.79%
Values	Daily Returns

Comcast Corp  vs.  KT Corp.

Comcast Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Comcast Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in May 2024. The current disturbance may also be a sign of long term up-swing for the company investors.

KT Corporation

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days KT Corporation has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, KT is not utilizing all of its potentials. The recent stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with Comcast Corp and KT

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

The idea behind Comcast Corp and KT Corporation 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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.