Correlation Between VanEck Hydrogen and VanEck Solana

Can any of the company-specific risk be diversified away by investing in both VanEck Hydrogen 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 Hydrogen 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 Hydrogen Economy and VanEck Solana ETN, you can compare the effects of market volatilities on VanEck Hydrogen 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 Hydrogen with a short position of VanEck Solana. Check out your portfolio center. Please also check ongoing floating volatility patterns of VanEck Hydrogen and VanEck Solana.

Diversification Opportunities for VanEck Hydrogen and VanEck Solana

0.45

Correlation Coefficient

VanEck Hydrogen  VanEck Solana

Very weak diversification

The 3 months correlation between VanEck and VanEck is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Hydrogen Economy 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 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 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 Hydrogen i.e., VanEck Hydrogen and VanEck Solana go up and down completely randomly.

Pair Corralation between VanEck Hydrogen and VanEck Solana

Assuming the 90 days trading horizon VanEck Hydrogen Economy is expected to under-perform the VanEck Solana. But the etf apears to be less risky and, when comparing its historical volatility, VanEck Hydrogen Economy is 4.08 times less risky than VanEck Solana. The etf trades about -0.12 of its potential returns per unit of risk. The VanEck Solana ETN is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest  1,041  in VanEck Solana ETN on December 3, 2024 and sell it today you would lose (231.00) from holding VanEck Solana ETN or give up 22.19% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	98.33%
Values	Daily Returns

VanEck Hydrogen Economy  vs.  VanEck Solana ETN

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 abnormal performance in the last few months, the Etf's basic indicators remain fairly stable which may send shares a bit higher in April 2025. The latest fuss may also be a sign of long-term up-swing for the fund sophisticated investors.

VanEck Solana ETN

Risk-Adjusted Performance

Very Weak

Over the last 90 days VanEck Solana ETN has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest abnormal performance, the Etf's basic indicators remain stable and the latest fuss on Wall Street may also be a sign of long-term gains for the fund sophisticated investors.

Pair Trading with VanEck Hydrogen and VanEck Solana

The main advantage of trading using opposite VanEck Hydrogen and VanEck Solana positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VanEck Hydrogen 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 Hydrogen Economy 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.