Correlation Between VanEck Gold and VanEck Solana

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

By analyzing existing cross correlation between VanEck Gold Miners and VanEck Solana ETN, you can compare the effects of market volatilities on VanEck Gold and VanEck Solana 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 VanEck Gold with a short position of VanEck Solana. Check out your portfolio center. Please also check ongoing floating volatility patterns of VanEck Gold and VanEck Solana.

Diversification Opportunities for VanEck Gold and VanEck Solana

-0.44

Correlation Coefficient

VanEck Gold  VanEck Solana

Very good diversification

The 3 months correlation between VanEck and VanEck is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Gold Miners and VanEck Solana ETN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VanEck Solana ETN and VanEck Gold 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 VanEck Gold Miners are associated (or correlated) with VanEck Solana. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VanEck Solana ETN has no effect on the direction of VanEck Gold i.e., VanEck Gold and VanEck Solana go up and down completely randomly.

Pair Corralation between VanEck Gold and VanEck Solana

Assuming the 90 days trading horizon VanEck Gold Miners is expected to under-perform the VanEck Solana. But the etf apears to be less risky and, when comparing its historical volatility, VanEck Gold Miners is 2.65 times less risky than VanEck Solana. The etf trades about -0.01 of its potential returns per unit of risk. The VanEck Solana ETN is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest  602.00  in VanEck Solana ETN on September 15, 2024 and sell it today you would earn a total of  466.00  from holding VanEck Solana ETN or generate 77.41% return on investment over 90 days.

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

VanEck Gold Miners  vs.  VanEck Solana ETN

VanEck Gold Miners

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days VanEck Gold Miners has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, VanEck Gold is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

VanEck Solana ETN

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in VanEck Solana ETN are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of fairly weak basic indicators, VanEck Solana showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with VanEck Gold and VanEck Solana

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

The idea behind VanEck Gold Miners and VanEck Solana ETN 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.