Correlation Between JPMorgan USD and KraneShares Asia
Can any of the company-specific risk be diversified away by investing in both JPMorgan USD and KraneShares Asia 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 JPMorgan USD and KraneShares Asia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between JPMorgan USD Emerging and KraneShares Asia Pacific, you can compare the effects of market volatilities on JPMorgan USD and KraneShares Asia 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 JPMorgan USD with a short position of KraneShares Asia. Check out your portfolio center. Please also check ongoing floating volatility patterns of JPMorgan USD and KraneShares Asia.
Diversification Opportunities for JPMorgan USD and KraneShares Asia
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between JPMorgan and KraneShares is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding JPMorgan USD Emerging and KraneShares Asia Pacific in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KraneShares Asia Pacific and JPMorgan USD 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 JPMorgan USD Emerging are associated (or correlated) with KraneShares Asia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KraneShares Asia Pacific has no effect on the direction of JPMorgan USD i.e., JPMorgan USD and KraneShares Asia go up and down completely randomly.
Pair Corralation between JPMorgan USD and KraneShares Asia
Given the investment horizon of 90 days JPMorgan USD is expected to generate 1.81 times less return on investment than KraneShares Asia. In addition to that, JPMorgan USD is 1.98 times more volatile than KraneShares Asia Pacific. It trades about 0.07 of its total potential returns per unit of risk. KraneShares Asia Pacific is currently generating about 0.24 per unit of volatility. If you would invest 2,180 in KraneShares Asia Pacific on September 3, 2024 and sell it today you would earn a total of 297.00 from holding KraneShares Asia Pacific or generate 13.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
JPMorgan USD Emerging vs. KraneShares Asia Pacific
Performance |
| Timeline |
| JPMorgan USD Emerging |
| KraneShares Asia Pacific |
JPMorgan USD and KraneShares Asia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with JPMorgan USD and KraneShares Asia
The main advantage of trading using opposite JPMorgan USD and KraneShares Asia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if JPMorgan USD position performs unexpectedly, KraneShares Asia 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 Asia will offset losses from the drop in KraneShares Asia's long position.| JPMorgan USD vs. SPDR Bloomberg Emerging | JPMorgan USD vs. Vanguard Emerging Markets | JPMorgan USD vs. SPDR Bloomberg Barclays | JPMorgan USD vs. VanEck JP Morgan |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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