Correlation Between Verizon Communications and KraneShares Global
Can any of the company-specific risk be diversified away by investing in both Verizon Communications and KraneShares Global 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 Verizon Communications and KraneShares Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Verizon Communications and KraneShares Global Carbon, you can compare the effects of market volatilities on Verizon Communications and KraneShares Global 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 Verizon Communications with a short position of KraneShares Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Verizon Communications and KraneShares Global.
Diversification Opportunities for Verizon Communications and KraneShares Global
-0.48 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Verizon and KraneShares is -0.48. Overlapping area represents the amount of risk that can be diversified away by holding Verizon Communications and KraneShares Global Carbon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KraneShares Global Carbon and Verizon Communications 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 Verizon Communications are associated (or correlated) with KraneShares Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KraneShares Global Carbon has no effect on the direction of Verizon Communications i.e., Verizon Communications and KraneShares Global go up and down completely randomly.
Pair Corralation between Verizon Communications and KraneShares Global
Allowing for the 90-day total investment horizon Verizon Communications is expected to generate 0.63 times more return on investment than KraneShares Global. However, Verizon Communications is 1.59 times less risky than KraneShares Global. It trades about 0.05 of its potential returns per unit of risk. KraneShares Global Carbon is currently generating about -0.02 per unit of risk. If you would invest 4,176 in Verizon Communications on December 4, 2024 and sell it today you would earn a total of 111.00 from holding Verizon Communications or generate 2.66% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Verizon Communications vs. KraneShares Global Carbon
Performance |
Timeline |
Verizon Communications |
KraneShares Global Carbon |
Verizon Communications and KraneShares Global Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Verizon Communications and KraneShares Global
The main advantage of trading using opposite Verizon Communications and KraneShares Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Verizon Communications position performs unexpectedly, KraneShares Global 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 Global will offset losses from the drop in KraneShares Global's long position.Verizon Communications vs. T Mobile | Verizon Communications vs. Comcast Corp | Verizon Communications vs. Lumen Technologies | Verizon Communications vs. Charter Communications |
KraneShares Global vs. United States Brent | KraneShares Global vs. ProShares K 1 Free | KraneShares Global vs. Invesco DB Energy | KraneShares Global vs. Invesco DB Oil |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
Other Complementary Tools
Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm |