Correlation Between KraneShares Bosera and Franklin FTSE
Can any of the company-specific risk be diversified away by investing in both KraneShares Bosera and Franklin FTSE 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 Bosera and Franklin FTSE into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KraneShares Bosera MSCI and Franklin FTSE China, you can compare the effects of market volatilities on KraneShares Bosera and Franklin FTSE 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 Bosera with a short position of Franklin FTSE. Check out your portfolio center. Please also check ongoing floating volatility patterns of KraneShares Bosera and Franklin FTSE.
Diversification Opportunities for KraneShares Bosera and Franklin FTSE
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between KraneShares and Franklin is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding KraneShares Bosera MSCI and Franklin FTSE China in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin FTSE China and KraneShares Bosera 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 Bosera MSCI are associated (or correlated) with Franklin FTSE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin FTSE China has no effect on the direction of KraneShares Bosera i.e., KraneShares Bosera and Franklin FTSE go up and down completely randomly.
Pair Corralation between KraneShares Bosera and Franklin FTSE
Considering the 90-day investment horizon KraneShares Bosera MSCI is expected to generate 1.06 times more return on investment than Franklin FTSE. However, KraneShares Bosera is 1.06 times more volatile than Franklin FTSE China. It trades about -0.15 of its potential returns per unit of risk. Franklin FTSE China is currently generating about -0.19 per unit of risk. If you would invest 2,532 in KraneShares Bosera MSCI on August 29, 2024 and sell it today you would lose (184.00) from holding KraneShares Bosera MSCI or give up 7.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
KraneShares Bosera MSCI vs. Franklin FTSE China
Performance |
| Timeline |
| KraneShares Bosera MSCI |
| Franklin FTSE China |
KraneShares Bosera and Franklin FTSE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KraneShares Bosera and Franklin FTSE
The main advantage of trading using opposite KraneShares Bosera and Franklin FTSE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KraneShares Bosera position performs unexpectedly, Franklin FTSE 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 Franklin FTSE will offset losses from the drop in Franklin FTSE's long position.| KraneShares Bosera vs. Global X MSCI | KraneShares Bosera vs. KraneShares MSCI All | KraneShares Bosera vs. Xtrackers Harvest CSI |
| Franklin FTSE vs. Franklin FTSE South | Franklin FTSE vs. Franklin FTSE Japan | Franklin FTSE vs. Franklin FTSE India | Franklin FTSE vs. Franklin FTSE Brazil |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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