Correlation Between Franklin FTSE and KraneShares
Can any of the company-specific risk be diversified away by investing in both Franklin FTSE and KraneShares 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 Franklin FTSE and KraneShares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin FTSE China and KraneShares, you can compare the effects of market volatilities on Franklin FTSE and KraneShares 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 Franklin FTSE with a short position of KraneShares. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin FTSE and KraneShares.
Diversification Opportunities for Franklin FTSE and KraneShares
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Franklin and KraneShares is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Franklin FTSE China and KraneShares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KraneShares and Franklin FTSE 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 Franklin FTSE China are associated (or correlated) with KraneShares. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KraneShares has no effect on the direction of Franklin FTSE i.e., Franklin FTSE and KraneShares go up and down completely randomly.
Pair Corralation between Franklin FTSE and KraneShares
If you would invest 1,852 in Franklin FTSE China on November 9, 2024 and sell it today you would earn a total of 71.00 from holding Franklin FTSE China or generate 3.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Franklin FTSE China vs. KraneShares
Performance |
| Timeline |
| Franklin FTSE China |
| KraneShares |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Franklin FTSE and KraneShares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin FTSE and KraneShares
The main advantage of trading using opposite Franklin FTSE and KraneShares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin FTSE position performs unexpectedly, KraneShares 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 will offset losses from the drop in KraneShares' long position.| Franklin FTSE vs. Franklin FTSE South | Franklin FTSE vs. Franklin FTSE Japan | Franklin FTSE vs. Franklin FTSE India | Franklin FTSE vs. Franklin FTSE Brazil |
| KraneShares vs. KraneShares SSE STAR | KraneShares vs. KraneShares MSCI China | KraneShares vs. KraneShares MSCI All |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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