Correlation Between VanEck Gold and Listed Funds

Can any of the company-specific risk be diversified away by investing in both VanEck Gold and Listed Funds 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 Listed Funds 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 Listed Funds Trust, you can compare the effects of market volatilities on VanEck Gold and Listed Funds 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 Listed Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of VanEck Gold and Listed Funds.

Diversification Opportunities for VanEck Gold and Listed Funds

0.72

Correlation Coefficient

VanEck Gold  Listed Funds

Poor diversification

The 3 months correlation between VanEck and Listed is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Gold Miners and Listed Funds Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Listed Funds Trust 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 Listed Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Listed Funds Trust has no effect on the direction of VanEck Gold i.e., VanEck Gold and Listed Funds go up and down completely randomly.

Pair Corralation between VanEck Gold and Listed Funds

Considering the 90-day investment horizon VanEck Gold Miners is expected to under-perform the Listed Funds. In addition to that, VanEck Gold is 2.84 times more volatile than Listed Funds Trust. It trades about -0.13 of its total potential returns per unit of risk. Listed Funds Trust is currently generating about -0.23 per unit of volatility. If you would invest  1,983  in Listed Funds Trust on October 6, 2024 and sell it today you would lose (143.00) from holding Listed Funds Trust or give up 7.21% of portfolio value over 90 days.

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

VanEck Gold Miners  vs.  Listed Funds Trust

VanEck Gold Miners

Risk-Adjusted Performance

0 of 100

Very 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 latest sluggish performance, the Etf's fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the ETF investors.

Listed Funds Trust

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Listed Funds Trust has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest uncertain performance, the Etf's essential indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the ETF venture institutional investors.

Pair Trading with VanEck Gold and Listed Funds

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

The idea behind VanEck Gold Miners and Listed Funds Trust 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..