Correlation Between CHIS and KraneShares MSCI

Can any of the company-specific risk be diversified away by investing in both CHIS and KraneShares MSCI 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 CHIS and KraneShares MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CHIS and KraneShares MSCI All, you can compare the effects of market volatilities on CHIS and KraneShares MSCI 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 CHIS with a short position of KraneShares MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of CHIS and KraneShares MSCI.

Diversification Opportunities for CHIS and KraneShares MSCI

0.59

Correlation Coefficient

CHIS  KraneShares MSCI

Very weak diversification

The 3 months correlation between CHIS and KraneShares is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding CHIS and KraneShares MSCI All in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KraneShares MSCI All and CHIS 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 CHIS are associated (or correlated) with KraneShares MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KraneShares MSCI All has no effect on the direction of CHIS i.e., CHIS and KraneShares MSCI go up and down completely randomly.

Pair Corralation between CHIS and KraneShares MSCI

If you would invest  1,981  in CHIS on October 1, 2024 and sell it today you would earn a total of  0.00  from holding CHIS or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	1.59%
Values	Daily Returns

CHIS  vs.  KraneShares MSCI All

CHIS

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days CHIS has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable forward indicators, CHIS is not utilizing all of its potentials. The latest stock price uproar, may contribute to short-horizon losses for the private investors.

KraneShares MSCI All

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days KraneShares MSCI All has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of unfluctuating performance in the last few months, the Etf's basic indicators remain rather sound which may send shares a bit higher in January 2025. The latest tumult may also be a sign of longer-term up-swing for the fund shareholders.

Pair Trading with CHIS and KraneShares MSCI

The main advantage of trading using opposite CHIS and KraneShares MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CHIS position performs unexpectedly, KraneShares MSCI 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 KraneShares MSCI will offset losses from the drop in KraneShares MSCI's long position.

The idea behind CHIS and KraneShares MSCI All pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.