Correlation Between United Hero and WISE KTAM
Can any of the company-specific risk be diversified away by investing in both United Hero and WISE KTAM 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 United Hero and WISE KTAM into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between United Hero ETF and WISE KTAM CSI, you can compare the effects of market volatilities on United Hero and WISE KTAM 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 United Hero with a short position of WISE KTAM. Check out your portfolio center. Please also check ongoing floating volatility patterns of United Hero and WISE KTAM.
Diversification Opportunities for United Hero and WISE KTAM
0.04 | Correlation Coefficient |
Significant diversification
The 3 months correlation between United and WISE is 0.04. Overlapping area represents the amount of risk that can be diversified away by holding United Hero ETF and WISE KTAM CSI in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on WISE KTAM CSI and United Hero 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 United Hero ETF are associated (or correlated) with WISE KTAM. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of WISE KTAM CSI has no effect on the direction of United Hero i.e., United Hero and WISE KTAM go up and down completely randomly.
Pair Corralation between United Hero and WISE KTAM
Assuming the 90 days trading horizon United Hero ETF is expected to generate 213.96 times more return on investment than WISE KTAM. However, United Hero is 213.96 times more volatile than WISE KTAM CSI. It trades about 0.27 of its potential returns per unit of risk. WISE KTAM CSI is currently generating about 0.12 per unit of risk. If you would invest 784.00 in United Hero ETF on August 24, 2024 and sell it today you would earn a total of 19.00 from holding United Hero ETF or generate 2.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
United Hero ETF vs. WISE KTAM CSI
Performance |
| Timeline |
| United Hero ETF |
| WISE KTAM CSI |
United Hero and WISE KTAM Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with United Hero and WISE KTAM
The main advantage of trading using opposite United Hero and WISE KTAM positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if United Hero position performs unexpectedly, WISE KTAM 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 WISE KTAM will offset losses from the drop in WISE KTAM's long position.| United Hero vs. ThaiDex SET50 Exchange | United Hero vs. BCAP MSCI Thailand | United Hero vs. BCAP SET100 | United Hero vs. KTAM Gold ETF |
| WISE KTAM vs. United Hero ETF | WISE KTAM vs. BCAP SET100 | WISE KTAM vs. KTAM Gold ETF | WISE KTAM vs. ThaiDEX SET High |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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