Correlation Between KraneShares Global and Astor Star

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

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

Diversification Opportunities for KraneShares Global and Astor Star

-0.04

Correlation Coefficient

KraneShares Global  Astor Star

Good diversification

The 3 months correlation between KraneShares and Astor is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding KraneShares Global Carbon and Astor Star Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Astor Star Fund and KraneShares Global 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 Global Carbon are associated (or correlated) with Astor Star. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Astor Star Fund has no effect on the direction of KraneShares Global i.e., KraneShares Global and Astor Star go up and down completely randomly.

Pair Corralation between KraneShares Global and Astor Star

Given the investment horizon of 90 days KraneShares Global Carbon is expected to under-perform the Astor Star. In addition to that, KraneShares Global is 3.23 times more volatile than Astor Star Fund. It trades about -0.01 of its total potential returns per unit of risk. Astor Star Fund is currently generating about 0.04 per unit of volatility. If you would invest  1,298  in Astor Star Fund on February 6, 2024 and sell it today you would earn a total of  146.00  from holding Astor Star Fund or generate 11.25% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

KraneShares Global Carbon  vs.  Astor Star Fund

KraneShares Global Carbon

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in KraneShares Global Carbon are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. In spite of very unfluctuating fundamental drivers, KraneShares Global may actually be approaching a critical reversion point that can send shares even higher in June 2024.

Astor Star Fund

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Astor Star Fund are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Astor Star is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with KraneShares Global and Astor Star

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

The idea behind KraneShares Global Carbon and Astor Star Fund 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.