Correlation Between VanEck Semiconductor and Roundhill Ball

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

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

Diversification Opportunities for VanEck Semiconductor and Roundhill Ball

0.68

Correlation Coefficient

VanEck Semiconductor  Roundhill Ball

Poor diversification

The 3 months correlation between VanEck and Roundhill is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Semiconductor ETF and Roundhill Ball Metaverse in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Roundhill Ball Metaverse and VanEck Semiconductor 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 Semiconductor ETF are associated (or correlated) with Roundhill Ball. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Roundhill Ball Metaverse has no effect on the direction of VanEck Semiconductor i.e., VanEck Semiconductor and Roundhill Ball go up and down completely randomly.

Pair Corralation between VanEck Semiconductor and Roundhill Ball

Considering the 90-day investment horizon VanEck Semiconductor ETF is expected to under-perform the Roundhill Ball. In addition to that, VanEck Semiconductor is 1.58 times more volatile than Roundhill Ball Metaverse. It trades about -0.08 of its total potential returns per unit of risk. Roundhill Ball Metaverse is currently generating about -0.03 per unit of volatility. If you would invest  1,449  in Roundhill Ball Metaverse on December 29, 2024 and sell it today you would lose (45.00) from holding Roundhill Ball Metaverse or give up 3.11% of portfolio value over 90 days.

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

VanEck Semiconductor ETF  vs.  Roundhill Ball Metaverse

VanEck Semiconductor ETF

Risk-Adjusted Performance

Very Weak

Over the last 90 days VanEck Semiconductor ETF has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Etf's primary indicators remain fairly strong which may send shares a bit higher in April 2025. The recent confusion may also be a sign of long-lasting up-swing for the Etf traders.

Roundhill Ball Metaverse

Risk-Adjusted Performance

Very Weak

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

Pair Trading with VanEck Semiconductor and Roundhill Ball

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

The idea behind VanEck Semiconductor ETF and Roundhill Ball Metaverse 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.