Correlation Between Dow Jones and KraneShares Bosera
Can any of the company-specific risk be diversified away by investing in both Dow Jones and KraneShares Bosera 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 Dow Jones and KraneShares Bosera into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dow Jones Industrial and KraneShares Bosera MSCI, you can compare the effects of market volatilities on Dow Jones and KraneShares Bosera 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 Dow Jones with a short position of KraneShares Bosera. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and KraneShares Bosera.
Diversification Opportunities for Dow Jones and KraneShares Bosera
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dow and KraneShares is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and KraneShares Bosera MSCI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KraneShares Bosera MSCI and Dow Jones 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 Dow Jones Industrial are associated (or correlated) with KraneShares Bosera. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KraneShares Bosera MSCI has no effect on the direction of Dow Jones i.e., Dow Jones and KraneShares Bosera go up and down completely randomly.
Pair Corralation between Dow Jones and KraneShares Bosera
Assuming the 90 days trading horizon Dow Jones is expected to generate 1.01 times less return on investment than KraneShares Bosera. But when comparing it to its historical volatility, Dow Jones Industrial is 2.88 times less risky than KraneShares Bosera. It trades about 0.13 of its potential returns per unit of risk. KraneShares Bosera MSCI is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 2,226 in KraneShares Bosera MSCI on August 24, 2024 and sell it today you would earn a total of 222.00 from holding KraneShares Bosera MSCI or generate 9.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dow Jones Industrial vs. KraneShares Bosera MSCI
Performance |
| Timeline |
Dow Jones and KraneShares Bosera Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
KraneShares Bosera MSCI
Pair trading matchups for KraneShares Bosera
Pair Trading with Dow Jones and KraneShares Bosera
The main advantage of trading using opposite Dow Jones and KraneShares Bosera positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, KraneShares Bosera 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 Bosera will offset losses from the drop in KraneShares Bosera's long position.| Dow Jones vs. Barrick Gold Corp | Dow Jones vs. Jutal Offshore Oil | Dow Jones vs. Eastern Co | Dow Jones vs. Weyco Group |
| KraneShares Bosera vs. Global X MSCI | KraneShares Bosera vs. KraneShares MSCI All | KraneShares Bosera vs. Xtrackers Harvest CSI |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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