Correlation Between KraneShares CSI and CHIM
Can any of the company-specific risk be diversified away by investing in both KraneShares CSI and CHIM 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 CSI and CHIM into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KraneShares CSI China and CHIM, you can compare the effects of market volatilities on KraneShares CSI and CHIM 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 CSI with a short position of CHIM. Check out your portfolio center. Please also check ongoing floating volatility patterns of KraneShares CSI and CHIM.
Diversification Opportunities for KraneShares CSI and CHIM
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between KraneShares and CHIM is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding KraneShares CSI China and CHIM in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CHIM and KraneShares CSI 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 CSI China are associated (or correlated) with CHIM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CHIM has no effect on the direction of KraneShares CSI i.e., KraneShares CSI and CHIM go up and down completely randomly.
Pair Corralation between KraneShares CSI and CHIM
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 Against |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
KraneShares CSI China vs. CHIM
Performance |
| Timeline |
| KraneShares CSI China |
| CHIM |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
KraneShares CSI and CHIM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KraneShares CSI and CHIM
The main advantage of trading using opposite KraneShares CSI and CHIM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KraneShares CSI position performs unexpectedly, CHIM 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 CHIM will offset losses from the drop in CHIM's long position.| KraneShares CSI vs. Invesco China Technology | KraneShares CSI vs. iShares MSCI India | KraneShares CSI vs. Xtrackers Harvest CSI | KraneShares CSI vs. SPDR SP China |
| CHIM vs. KraneShares CSI China | CHIM vs. Invesco China Technology | CHIM vs. iShares MSCI India | CHIM 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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