Correlation Between VanEck Global and VanEck MSCI
Can any of the company-specific risk be diversified away by investing in both VanEck Global and VanEck MSCI 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 Global and VanEck MSCI into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VanEck Global Clean and VanEck MSCI International, you can compare the effects of market volatilities on VanEck Global and VanEck MSCI 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 Global with a short position of VanEck MSCI. Check out your portfolio center. Please also check ongoing floating volatility patterns of VanEck Global and VanEck MSCI.
Diversification Opportunities for VanEck Global and VanEck MSCI
-0.85 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between VanEck and VanEck is -0.85. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Global Clean and VanEck MSCI International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VanEck MSCI International and VanEck Global 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 Global Clean are associated (or correlated) with VanEck MSCI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VanEck MSCI International has no effect on the direction of VanEck Global i.e., VanEck Global and VanEck MSCI go up and down completely randomly.
Pair Corralation between VanEck Global and VanEck MSCI
Assuming the 90 days trading horizon VanEck Global Clean is expected to under-perform the VanEck MSCI. In addition to that, VanEck Global is 1.64 times more volatile than VanEck MSCI International. It trades about -0.13 of its total potential returns per unit of risk. VanEck MSCI International is currently generating about 0.22 per unit of volatility. If you would invest 2,942 in VanEck MSCI International on August 26, 2024 and sell it today you would earn a total of 185.00 from holding VanEck MSCI International or generate 6.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
VanEck Global Clean vs. VanEck MSCI International
Performance |
| Timeline |
| VanEck Global Clean |
| VanEck MSCI International |
VanEck Global and VanEck MSCI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VanEck Global and VanEck MSCI
The main advantage of trading using opposite VanEck Global and VanEck MSCI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VanEck Global position performs unexpectedly, VanEck MSCI 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 MSCI will offset losses from the drop in VanEck MSCI's long position.| VanEck Global vs. CD Private Equity | VanEck Global vs. SPDR SPASX 200 | VanEck Global vs. Ecofibre | VanEck Global vs. iShares Global Healthcare |
| VanEck MSCI vs. CD Private Equity | VanEck MSCI vs. SPDR SPASX 200 | VanEck MSCI vs. Ecofibre | VanEck MSCI vs. iShares Global Healthcare |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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