Correlation Between KraneShares and Guinness Atkinson

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

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

Diversification Opportunities for KraneShares and Guinness Atkinson

0.15

Correlation Coefficient

KraneShares  Guinness Atkinson

Average diversification

The 3 months correlation between KraneShares and Guinness is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding KraneShares and Guinness Atkinson Asset in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guinness Atkinson Asset and KraneShares 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 are associated (or correlated) with Guinness Atkinson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guinness Atkinson Asset has no effect on the direction of KraneShares i.e., KraneShares and Guinness Atkinson go up and down completely randomly.

Pair Corralation between KraneShares and Guinness Atkinson

Given the investment horizon of 90 days KraneShares is expected to under-perform the Guinness Atkinson. In addition to that, KraneShares is 1.25 times more volatile than Guinness Atkinson Asset. It trades about -0.04 of its total potential returns per unit of risk. Guinness Atkinson Asset is currently generating about 0.01 per unit of volatility. If you would invest  1,476  in Guinness Atkinson Asset on October 26, 2024 and sell it today you would earn a total of  62.00  from holding Guinness Atkinson Asset or generate 4.2% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Insignificant
Accuracy	26.59%
Values	Daily Returns

KraneShares  vs.  Guinness Atkinson Asset

KraneShares

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days KraneShares has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, KraneShares is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Guinness Atkinson Asset

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Guinness Atkinson Asset has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Guinness Atkinson is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with KraneShares and Guinness Atkinson

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

The idea behind KraneShares and Guinness Atkinson Asset 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..