Correlation Between KraneShares MSCI and Columbia
Can any of the company-specific risk be diversified away by investing in both KraneShares MSCI and Columbia 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 Columbia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KraneShares MSCI One and Columbia EM Core, you can compare the effects of market volatilities on KraneShares MSCI and Columbia 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 Columbia. Check out your portfolio center. Please also check ongoing floating volatility patterns of KraneShares MSCI and Columbia.
Diversification Opportunities for KraneShares MSCI and Columbia
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between KraneShares and Columbia is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding KraneShares MSCI One and Columbia EM Core in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Columbia EM Core 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 One are associated (or correlated) with Columbia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Columbia EM Core has no effect on the direction of KraneShares MSCI i.e., KraneShares MSCI and Columbia go up and down completely randomly.
Pair Corralation between KraneShares MSCI and Columbia
Given the investment horizon of 90 days KraneShares MSCI is expected to generate 23.11 times less return on investment than Columbia. In addition to that, KraneShares MSCI is 1.33 times more volatile than Columbia EM Core. It trades about 0.0 of its total potential returns per unit of risk. Columbia EM Core is currently generating about 0.05 per unit of volatility. If you would invest 2,570 in Columbia EM Core on August 29, 2024 and sell it today you would earn a total of 563.00 from holding Columbia EM Core or generate 21.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.39% |
| Values | Daily Returns |
KraneShares MSCI One vs. Columbia EM Core
Performance |
| Timeline |
| KraneShares MSCI One |
| Columbia EM Core |
KraneShares MSCI and Columbia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KraneShares MSCI and Columbia
The main advantage of trading using opposite KraneShares MSCI and Columbia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KraneShares MSCI position performs unexpectedly, Columbia 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 Columbia will offset losses from the drop in Columbia's long position.| KraneShares MSCI vs. iShares Dividend and | KraneShares MSCI vs. Martin Currie Sustainable | KraneShares MSCI vs. VictoryShares THB Mid | KraneShares MSCI vs. Mast Global Battery |
| Columbia vs. iShares MSCI Emerging | Columbia vs. Hartford Multifactor Emerging | Columbia vs. SPDR MSCI Emerging | Columbia vs. FlexShares Morningstar Emerging |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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