Correlation Between VanEck Polkadot and Kendrion

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

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

Diversification Opportunities for VanEck Polkadot and Kendrion

-0.6

Correlation Coefficient

VanEck Polkadot  Kendrion

Excellent diversification

The 3 months correlation between VanEck and Kendrion is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Polkadot ETN and Kendrion NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kendrion NV and VanEck Polkadot 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 Polkadot ETN are associated (or correlated) with Kendrion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kendrion NV has no effect on the direction of VanEck Polkadot i.e., VanEck Polkadot and Kendrion go up and down completely randomly.

Pair Corralation between VanEck Polkadot and Kendrion

Assuming the 90 days trading horizon VanEck Polkadot ETN is expected to generate 5.83 times more return on investment than Kendrion. However, VanEck Polkadot is 5.83 times more volatile than Kendrion NV. It trades about 0.17 of its potential returns per unit of risk. Kendrion NV is currently generating about -0.14 per unit of risk. If you would invest  133.00  in VanEck Polkadot ETN on September 18, 2024 and sell it today you would earn a total of  149.00  from holding VanEck Polkadot ETN or generate 112.03% return on investment over 90 days.

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

VanEck Polkadot ETN  vs.  Kendrion NV

VanEck Polkadot ETN

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in VanEck Polkadot ETN are ranked lower than 13 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, VanEck Polkadot unveiled solid returns over the last few months and may actually be approaching a breakup point.

Kendrion NV

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kendrion NV has generated negative risk-adjusted returns adding no value to investors with long positions. Despite weak performance in the last few months, the Stock's basic indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Pair Trading with VanEck Polkadot and Kendrion

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

The idea behind VanEck Polkadot ETN and Kendrion NV 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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..