Correlation Between KraneShares Global and Ultimus Managers
Can any of the company-specific risk be diversified away by investing in both KraneShares Global and Ultimus Managers 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 Global and Ultimus Managers into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KraneShares Global Carbon and Ultimus Managers Trust, you can compare the effects of market volatilities on KraneShares Global and Ultimus Managers 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 Global with a short position of Ultimus Managers. Check out your portfolio center. Please also check ongoing floating volatility patterns of KraneShares Global and Ultimus Managers.
Diversification Opportunities for KraneShares Global and Ultimus Managers
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between KraneShares and Ultimus is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding KraneShares Global Carbon and Ultimus Managers Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ultimus Managers Trust and KraneShares Global 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 Global Carbon are associated (or correlated) with Ultimus Managers. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ultimus Managers Trust has no effect on the direction of KraneShares Global i.e., KraneShares Global and Ultimus Managers go up and down completely randomly.
Pair Corralation between KraneShares Global and Ultimus Managers
Given the investment horizon of 90 days KraneShares Global Carbon is expected to under-perform the Ultimus Managers. In addition to that, KraneShares Global is 1.66 times more volatile than Ultimus Managers Trust. It trades about -0.03 of its total potential returns per unit of risk. Ultimus Managers Trust is currently generating about 0.12 per unit of volatility. If you would invest 2,326 in Ultimus Managers Trust on September 12, 2024 and sell it today you would earn a total of 420.00 from holding Ultimus Managers Trust or generate 18.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 51.96% |
| Values | Daily Returns |
KraneShares Global Carbon vs. Ultimus Managers Trust
Performance |
| Timeline |
| KraneShares Global Carbon |
| Ultimus Managers Trust |
KraneShares Global and Ultimus Managers Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KraneShares Global and Ultimus Managers
The main advantage of trading using opposite KraneShares Global and Ultimus Managers positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KraneShares Global position performs unexpectedly, Ultimus Managers 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 Ultimus Managers will offset losses from the drop in Ultimus Managers' long position.| KraneShares Global vs. Ultimus Managers Trust | KraneShares Global vs. Direxion Daily SP | KraneShares Global vs. EA Series Trust | KraneShares Global vs. Global X MLP |
| Ultimus Managers vs. Direxion Daily SP | Ultimus Managers vs. EA Series Trust | Ultimus Managers vs. Global X MLP | Ultimus Managers vs. ETRACS Quarterly Pay |
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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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