Correlation Between KraneShares MSCI and KraneShares CSI
Can any of the company-specific risk be diversified away by investing in both KraneShares MSCI and KraneShares CSI 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 KraneShares MSCI and KraneShares CSI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KraneShares MSCI All and KraneShares CSI China, you can compare the effects of market volatilities on KraneShares MSCI and KraneShares CSI 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 KraneShares MSCI with a short position of KraneShares CSI. Check out your portfolio center. Please also check ongoing floating volatility patterns of KraneShares MSCI and KraneShares CSI.
Diversification Opportunities for KraneShares MSCI and KraneShares CSI
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between KraneShares and KraneShares is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding KraneShares MSCI All and KraneShares CSI China in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KraneShares CSI China and KraneShares MSCI 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 KraneShares MSCI All are associated (or correlated) with KraneShares CSI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KraneShares CSI China has no effect on the direction of KraneShares MSCI i.e., KraneShares MSCI and KraneShares CSI go up and down completely randomly.
Pair Corralation between KraneShares MSCI and KraneShares CSI
Given the investment horizon of 90 days KraneShares MSCI is expected to generate 3.91 times less return on investment than KraneShares CSI. But when comparing it to its historical volatility, KraneShares MSCI All is 1.3 times less risky than KraneShares CSI. It trades about 0.03 of its potential returns per unit of risk. KraneShares CSI China is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 3,065 in KraneShares CSI China on September 13, 2024 and sell it today you would earn a total of 148.00 from holding KraneShares CSI China or generate 4.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
KraneShares MSCI All vs. KraneShares CSI China
Performance |
| Timeline |
| KraneShares MSCI All |
| KraneShares CSI China |
KraneShares MSCI and KraneShares CSI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KraneShares MSCI and KraneShares CSI
The main advantage of trading using opposite KraneShares MSCI and KraneShares CSI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KraneShares MSCI position performs unexpectedly, KraneShares CSI 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 CSI will offset losses from the drop in KraneShares CSI's long position.| KraneShares MSCI vs. KraneShares CSI China | KraneShares MSCI vs. Invesco China Technology | KraneShares MSCI vs. iShares MSCI India | KraneShares MSCI vs. Xtrackers Harvest CSI |
| KraneShares CSI vs. Invesco China Technology | KraneShares CSI vs. iShares MSCI India | KraneShares CSI vs. Xtrackers Harvest CSI | KraneShares CSI vs. SPDR SP China |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
Other Complementary Tools
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges |