Correlation Between KraneShares Bosera and Matthews China
Can any of the company-specific risk be diversified away by investing in both KraneShares Bosera and Matthews China 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 Matthews China 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 Matthews China Discovery, you can compare the effects of market volatilities on KraneShares Bosera and Matthews China 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 Matthews China. Check out your portfolio center. Please also check ongoing floating volatility patterns of KraneShares Bosera and Matthews China.
Diversification Opportunities for KraneShares Bosera and Matthews China
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between KraneShares and Matthews is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding KraneShares Bosera MSCI and Matthews China Discovery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Matthews China Discovery 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 Matthews China. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Matthews China Discovery has no effect on the direction of KraneShares Bosera i.e., KraneShares Bosera and Matthews China go up and down completely randomly.
Pair Corralation between KraneShares Bosera and Matthews China
Considering the 90-day investment horizon KraneShares Bosera is expected to generate 1.63 times less return on investment than Matthews China. But when comparing it to its historical volatility, KraneShares Bosera MSCI is 1.19 times less risky than Matthews China. It trades about 0.02 of its potential returns per unit of risk. Matthews China Discovery is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 2,538 in Matthews China Discovery on August 31, 2024 and sell it today you would earn a total of 163.00 from holding Matthews China Discovery or generate 6.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 60.43% |
| Values | Daily Returns |
KraneShares Bosera MSCI vs. Matthews China Discovery
Performance |
| Timeline |
| KraneShares Bosera MSCI |
| Matthews China Discovery |
KraneShares Bosera and Matthews China Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KraneShares Bosera and Matthews China
The main advantage of trading using opposite KraneShares Bosera and Matthews China positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KraneShares Bosera position performs unexpectedly, Matthews China 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 Matthews China will offset losses from the drop in Matthews China's long position.| KraneShares Bosera vs. Global X MSCI | KraneShares Bosera vs. KraneShares MSCI All | KraneShares Bosera vs. Xtrackers Harvest CSI |
| Matthews China vs. Xtrackers Harvest CSI | Matthews China vs. Aquagold International | Matthews China vs. Thrivent High Yield | Matthews China vs. Morningstar Unconstrained Allocation |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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