Correlation Between EA Series and KraneShares Global
Can any of the company-specific risk be diversified away by investing in both EA Series and KraneShares Global 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 EA Series and KraneShares Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EA Series Trust and KraneShares Global Carbon, you can compare the effects of market volatilities on EA Series and KraneShares Global 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 EA Series with a short position of KraneShares Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of EA Series and KraneShares Global.
Diversification Opportunities for EA Series and KraneShares Global
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between DRLL and KraneShares is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding EA Series Trust and KraneShares Global Carbon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KraneShares Global Carbon and EA Series 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 EA Series Trust are associated (or correlated) with KraneShares Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KraneShares Global Carbon has no effect on the direction of EA Series i.e., EA Series and KraneShares Global go up and down completely randomly.
Pair Corralation between EA Series and KraneShares Global
Given the investment horizon of 90 days EA Series Trust is expected to generate 0.88 times more return on investment than KraneShares Global. However, EA Series Trust is 1.14 times less risky than KraneShares Global. It trades about 0.01 of its potential returns per unit of risk. KraneShares Global Carbon is currently generating about -0.02 per unit of risk. If you would invest 2,787 in EA Series Trust on September 13, 2024 and sell it today you would earn a total of 72.00 from holding EA Series Trust or generate 2.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
EA Series Trust vs. KraneShares Global Carbon
Performance |
| Timeline |
| EA Series Trust |
| KraneShares Global Carbon |
EA Series and KraneShares Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EA Series and KraneShares Global
The main advantage of trading using opposite EA Series and KraneShares Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EA Series position performs unexpectedly, KraneShares Global 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 Global will offset losses from the drop in KraneShares Global's long position.| EA Series vs. EA Series Trust | EA Series vs. EA Series Trust | EA Series vs. Rumble Inc | EA Series vs. EA Series Trust |
| KraneShares Global vs. Ultimus Managers Trust | KraneShares Global vs. Direxion Daily SP | KraneShares Global vs. EA Series Trust | KraneShares Global vs. Global X MLP |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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