Correlation Between VanEck Solana and LG Clean

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Can any of the company-specific risk be diversified away by investing in both VanEck Solana and LG Clean 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 Solana and LG Clean into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VanEck Solana ETN and LG Clean Energy, you can compare the effects of market volatilities on VanEck Solana and LG Clean 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 Solana with a short position of LG Clean. Check out your portfolio center. Please also check ongoing floating volatility patterns of VanEck Solana and LG Clean.

Diversification Opportunities for VanEck Solana and LG Clean

VanEckRENWDiversified AwayVanEckRENWDiversified Away100%
-0.05
  Correlation Coefficient

Good diversification

The 3 months correlation between VanEck and RENW is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Solana ETN and LG Clean Energy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on LG Clean Energy and VanEck Solana 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 Solana ETN are associated (or correlated) with LG Clean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of LG Clean Energy has no effect on the direction of VanEck Solana i.e., VanEck Solana and LG Clean go up and down completely randomly.

Pair Corralation between VanEck Solana and LG Clean

Assuming the 90 days trading horizon VanEck Solana ETN is expected to generate 4.0 times more return on investment than LG Clean. However, VanEck Solana is 4.0 times more volatile than LG Clean Energy. It trades about 0.15 of its potential returns per unit of risk. LG Clean Energy is currently generating about 0.01 per unit of risk. If you would invest  715.00  in VanEck Solana ETN on October 21, 2024 and sell it today you would earn a total of  368.00  from holding VanEck Solana ETN or generate 51.47% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

VanEck Solana ETN  vs.  LG Clean Energy

 Performance 
JavaScript chart by amCharts 3.21.15NovDec2025 -30-20-10010
JavaScript chart by amCharts 3.21.15VSOL RENW
       Timeline  
VanEck Solana ETN 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Good
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 fairly weak basic indicators, VanEck Solana showed solid returns over the last few months and may actually be approaching a breakup point.
LG Clean Energy 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days LG Clean Energy has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, LG Clean is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.
JavaScript chart by amCharts 3.21.15NovDecJanDecJan7.888.28.48.68.8

VanEck Solana and LG Clean Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-17.21-12.89-8.57-4.25-0.014.519.1713.8318.4923.15 0.050.100.150.20
JavaScript chart by amCharts 3.21.15VSOL RENW
       Returns  

Pair Trading with VanEck Solana and LG Clean

The main advantage of trading using opposite VanEck Solana and LG Clean positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VanEck Solana position performs unexpectedly, LG Clean 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 LG Clean will offset losses from the drop in LG Clean's long position.
The idea behind VanEck Solana ETN and LG Clean Energy 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.

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