Correlation Between VanEck Vectors and VanEck Vectors

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

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

Diversification Opportunities for VanEck Vectors and VanEck Vectors

0.1

Correlation Coefficient

VanEck Vectors  VanEck Vectors

Average diversification

The 3 months correlation between VanEck and VanEck is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Vectors UCITS and VanEck Vectors Morningstar in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VanEck Vectors Morni and VanEck Vectors 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 Vectors UCITS are associated (or correlated) with VanEck Vectors. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VanEck Vectors Morni has no effect on the direction of VanEck Vectors i.e., VanEck Vectors and VanEck Vectors go up and down completely randomly.

Pair Corralation between VanEck Vectors and VanEck Vectors

Assuming the 90 days trading horizon VanEck Vectors UCITS is expected to under-perform the VanEck Vectors. But the etf apears to be less risky and, when comparing its historical volatility, VanEck Vectors UCITS is 2.99 times less risky than VanEck Vectors. The etf trades about -0.05 of its potential returns per unit of risk. The VanEck Vectors Morningstar is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest  633.00  in VanEck Vectors Morningstar on December 21, 2024 and sell it today you would earn a total of  112.00  from holding VanEck Vectors Morningstar or generate 17.69% return on investment over 90 days.

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

VanEck Vectors UCITS  vs.  VanEck Vectors Morningstar

VanEck Vectors UCITS

Risk-Adjusted Performance

Very Weak

Over the last 90 days VanEck Vectors UCITS has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, VanEck Vectors is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

VanEck Vectors Morni

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in VanEck Vectors Morningstar are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, VanEck Vectors unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with VanEck Vectors and VanEck Vectors

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

The idea behind VanEck Vectors UCITS and VanEck Vectors Morningstar 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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.