Correlation Between IShares Treasury and KraneShares Electric
Can any of the company-specific risk be diversified away by investing in both IShares Treasury and KraneShares Electric 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 IShares Treasury and KraneShares Electric into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between iShares Treasury Bond and KraneShares Electric Vehicles, you can compare the effects of market volatilities on IShares Treasury and KraneShares Electric 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 IShares Treasury with a short position of KraneShares Electric. Check out your portfolio center. Please also check ongoing floating volatility patterns of IShares Treasury and KraneShares Electric.
Diversification Opportunities for IShares Treasury and KraneShares Electric
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between IShares and KraneShares is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding iShares Treasury Bond and KraneShares Electric Vehicles in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KraneShares Electric and IShares Treasury 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 iShares Treasury Bond are associated (or correlated) with KraneShares Electric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KraneShares Electric has no effect on the direction of IShares Treasury i.e., IShares Treasury and KraneShares Electric go up and down completely randomly.
Pair Corralation between IShares Treasury and KraneShares Electric
Assuming the 90 days trading horizon IShares Treasury is expected to generate 1.29 times less return on investment than KraneShares Electric. But when comparing it to its historical volatility, iShares Treasury Bond is 1.96 times less risky than KraneShares Electric. It trades about 0.03 of its potential returns per unit of risk. KraneShares Electric Vehicles is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,229 in KraneShares Electric Vehicles on August 30, 2024 and sell it today you would earn a total of 35.00 from holding KraneShares Electric Vehicles or generate 2.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
iShares Treasury Bond vs. KraneShares Electric Vehicles
Performance |
| Timeline |
| iShares Treasury Bond |
| KraneShares Electric |
IShares Treasury and KraneShares Electric Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IShares Treasury and KraneShares Electric
The main advantage of trading using opposite IShares Treasury and KraneShares Electric positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IShares Treasury position performs unexpectedly, KraneShares Electric 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 Electric will offset losses from the drop in KraneShares Electric's long position.| IShares Treasury vs. iShares MSCI Japan | IShares Treasury vs. iShares JP Morgan | IShares Treasury vs. iShares MSCI Europe | IShares Treasury vs. iShares Nasdaq Biotechnology |
| KraneShares Electric vs. Leverage Shares 3x | KraneShares Electric vs. GraniteShares 3x Short | KraneShares Electric vs. WisdomTree Natural Gas | KraneShares Electric vs. Leverage Shares 3x |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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