Correlation Between VanEck 1 and VanEck Vectors
Can any of the company-specific risk be diversified away by investing in both VanEck 1 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 1 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 1 5 Year and VanEck Vectors Small, you can compare the effects of market volatilities on VanEck 1 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 1 with a short position of VanEck Vectors. Check out your portfolio center. Please also check ongoing floating volatility patterns of VanEck 1 and VanEck Vectors.
Diversification Opportunities for VanEck 1 and VanEck Vectors
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between VanEck and VanEck is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding VanEck 1 5 Year and VanEck Vectors Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VanEck Vectors Small and VanEck 1 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 1 5 Year 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 Small has no effect on the direction of VanEck 1 i.e., VanEck 1 and VanEck Vectors go up and down completely randomly.
Pair Corralation between VanEck 1 and VanEck Vectors
Assuming the 90 days trading horizon VanEck 1 is expected to generate 2.95 times less return on investment than VanEck Vectors. But when comparing it to its historical volatility, VanEck 1 5 Year is 3.07 times less risky than VanEck Vectors. It trades about 0.08 of its potential returns per unit of risk. VanEck Vectors Small is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,656 in VanEck Vectors Small on August 29, 2024 and sell it today you would earn a total of 331.00 from holding VanEck Vectors Small or generate 19.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 69.28% |
| Values | Daily Returns |
VanEck 1 5 Year vs. VanEck Vectors Small
Performance |
| Timeline |
| VanEck 1 5 |
| VanEck Vectors Small |
VanEck 1 and VanEck Vectors Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VanEck 1 and VanEck Vectors
The main advantage of trading using opposite VanEck 1 and VanEck Vectors positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VanEck 1 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.| VanEck 1 vs. BetaShares Geared Australian | VanEck 1 vs. BetaShares Global Robotics | VanEck 1 vs. iShares China LargeCap | VanEck 1 vs. Russell Australian Government |
| VanEck Vectors vs. SPDR SP 500 | VanEck Vectors vs. Vanguard Total Market | VanEck Vectors vs. iShares Core SP | VanEck Vectors vs. iShares Core SP |
Check out your portfolio center.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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
Other Complementary Tools
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |