Correlation Between Boeing and KraneShares MSCI
Can any of the company-specific risk be diversified away by investing in both Boeing and KraneShares MSCI 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 Boeing and KraneShares MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Boeing and KraneShares MSCI All, you can compare the effects of market volatilities on Boeing and KraneShares MSCI 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 Boeing with a short position of KraneShares MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of Boeing and KraneShares MSCI.
Diversification Opportunities for Boeing and KraneShares MSCI
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Boeing and KraneShares is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding The Boeing and KraneShares MSCI All in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KraneShares MSCI All and Boeing 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 The Boeing are associated (or correlated) with KraneShares MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KraneShares MSCI All has no effect on the direction of Boeing i.e., Boeing and KraneShares MSCI go up and down completely randomly.
Pair Corralation between Boeing and KraneShares MSCI
Allowing for the 90-day total investment horizon The Boeing is expected to generate 1.07 times more return on investment than KraneShares MSCI. However, Boeing is 1.07 times more volatile than KraneShares MSCI All. It trades about 0.04 of its potential returns per unit of risk. KraneShares MSCI All is currently generating about -0.14 per unit of risk. If you would invest 15,069 in The Boeing on August 28, 2024 and sell it today you would earn a total of 241.00 from holding The Boeing or generate 1.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
The Boeing vs. KraneShares MSCI All
Performance |
| Timeline |
| Boeing |
| KraneShares MSCI All |
Boeing and KraneShares MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Boeing and KraneShares MSCI
The main advantage of trading using opposite Boeing and KraneShares MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Boeing position performs unexpectedly, KraneShares MSCI 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 KraneShares MSCI will offset losses from the drop in KraneShares MSCI's long position.The idea behind The Boeing and KraneShares MSCI All 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.| KraneShares MSCI vs. KraneShares MSCI China | KraneShares MSCI vs. Global X MSCI | KraneShares MSCI vs. KraneShares Bosera MSCI | KraneShares MSCI vs. KraneShares SSE STAR |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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