Correlation Between VanEck Hydrogen and VanEck Crypto

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

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

Diversification Opportunities for VanEck Hydrogen and VanEck Crypto

0.73

Correlation Coefficient

VanEck Hydrogen  VanEck Crypto

Poor diversification

The 3 months correlation between VanEck and VanEck is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Hydrogen Economy and VanEck Crypto Blockchain in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VanEck Crypto Blockchain and VanEck Hydrogen 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 Hydrogen Economy are associated (or correlated) with VanEck Crypto. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VanEck Crypto Blockchain has no effect on the direction of VanEck Hydrogen i.e., VanEck Hydrogen and VanEck Crypto go up and down completely randomly.

Pair Corralation between VanEck Hydrogen and VanEck Crypto

Assuming the 90 days trading horizon VanEck Hydrogen Economy is expected to generate 0.42 times more return on investment than VanEck Crypto. However, VanEck Hydrogen Economy is 2.38 times less risky than VanEck Crypto. It trades about -0.1 of its potential returns per unit of risk. VanEck Crypto Blockchain is currently generating about -0.11 per unit of risk. If you would invest  548.00  in VanEck Hydrogen Economy on December 29, 2024 and sell it today you would lose (79.00) from holding VanEck Hydrogen Economy or give up 14.42% of portfolio value over 90 days.

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

VanEck Hydrogen Economy  vs.  VanEck Crypto Blockchain

VanEck Hydrogen Economy

Risk-Adjusted Performance

Very Weak

Over the last 90 days VanEck Hydrogen Economy has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Etf's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the exchange-traded fund private investors.

VanEck Crypto Blockchain

Risk-Adjusted Performance

Very Weak

Over the last 90 days VanEck Crypto Blockchain has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Etf's basic indicators remain comparatively stable which may send shares a bit higher in April 2025. The newest uproar may also be a sign of mid-term up-swing for the exchange-traded fund private investors.

Pair Trading with VanEck Hydrogen and VanEck Crypto

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

The idea behind VanEck Hydrogen Economy and VanEck Crypto Blockchain 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.