Correlation Between CT Private and KraneShares MSCI
Can any of the company-specific risk be diversified away by investing in both CT Private 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 CT Private and KraneShares MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CT Private Equity and KraneShares MSCI China, you can compare the effects of market volatilities on CT Private 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 CT Private with a short position of KraneShares MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of CT Private and KraneShares MSCI.
Diversification Opportunities for CT Private and KraneShares MSCI
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CTPE and KraneShares is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding CT Private Equity and KraneShares MSCI China in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KraneShares MSCI China and CT Private 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 CT Private Equity 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 China has no effect on the direction of CT Private i.e., CT Private and KraneShares MSCI go up and down completely randomly.
Pair Corralation between CT Private and KraneShares MSCI
Assuming the 90 days trading horizon CT Private Equity is expected to generate 0.77 times more return on investment than KraneShares MSCI. However, CT Private Equity is 1.3 times less risky than KraneShares MSCI. It trades about 0.34 of its potential returns per unit of risk. KraneShares MSCI China is currently generating about -0.11 per unit of risk. If you would invest 41,800 in CT Private Equity on August 30, 2024 and sell it today you would earn a total of 4,400 from holding CT Private Equity or generate 10.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CT Private Equity vs. KraneShares MSCI China
Performance |
| Timeline |
| CT Private Equity |
| KraneShares MSCI China |
CT Private and KraneShares MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CT Private and KraneShares MSCI
The main advantage of trading using opposite CT Private and KraneShares MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CT Private 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.| CT Private vs. Aberdeen New India | CT Private vs. Downing Strategic Micro Cap | CT Private vs. Baillie Gifford Growth | CT Private vs. Blackrock Energy and |
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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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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