Correlation Between Tidal ETF and KraneShares
Can any of the company-specific risk be diversified away by investing in both Tidal ETF 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 Tidal ETF and KraneShares into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tidal ETF Trust and KraneShares, you can compare the effects of market volatilities on Tidal ETF 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 Tidal ETF with a short position of KraneShares. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tidal ETF and KraneShares.
Diversification Opportunities for Tidal ETF and KraneShares
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Tidal and KraneShares is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Tidal ETF Trust and KraneShares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KraneShares and Tidal ETF 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 Tidal ETF Trust 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 Tidal ETF i.e., Tidal ETF and KraneShares go up and down completely randomly.
Pair Corralation between Tidal ETF and KraneShares
If you would invest 1,927 in Tidal ETF Trust on September 12, 2024 and sell it today you would earn a total of 6.00 from holding Tidal ETF Trust or generate 0.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 4.55% |
| Values | Daily Returns |
Tidal ETF Trust vs. KraneShares
Performance |
| Timeline |
| Tidal ETF Trust |
| KraneShares |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Tidal ETF and KraneShares Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tidal ETF and KraneShares
The main advantage of trading using opposite Tidal ETF and KraneShares positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tidal ETF 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.| Tidal ETF vs. JP Morgan Exchange Traded | Tidal ETF vs. FlexShares STOXX ESG | Tidal ETF vs. IQ Candriam ESG |
| KraneShares vs. KraneShares CSI China | KraneShares vs. Invesco China Technology | KraneShares vs. iShares MSCI India | KraneShares 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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