Correlation Between VanEck Green and IShares USD
Can any of the company-specific risk be diversified away by investing in both VanEck Green and IShares USD 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 Green and IShares USD into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VanEck Green Bond and iShares USD Green, you can compare the effects of market volatilities on VanEck Green and IShares USD 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 Green with a short position of IShares USD. Check out your portfolio center. Please also check ongoing floating volatility patterns of VanEck Green and IShares USD.
Diversification Opportunities for VanEck Green and IShares USD
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between VanEck and IShares is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Green Bond and iShares USD Green in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares USD Green and VanEck Green 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 Green Bond are associated (or correlated) with IShares USD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares USD Green has no effect on the direction of VanEck Green i.e., VanEck Green and IShares USD go up and down completely randomly.
Pair Corralation between VanEck Green and IShares USD
Given the investment horizon of 90 days VanEck Green Bond is expected to generate 0.92 times more return on investment than IShares USD. However, VanEck Green Bond is 1.09 times less risky than IShares USD. It trades about 0.13 of its potential returns per unit of risk. iShares USD Green is currently generating about 0.11 per unit of risk. If you would invest 2,302 in VanEck Green Bond on August 24, 2024 and sell it today you would earn a total of 90.00 from holding VanEck Green Bond or generate 3.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
VanEck Green Bond vs. iShares USD Green
Performance |
| Timeline |
| VanEck Green Bond |
| iShares USD Green |
VanEck Green and IShares USD Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VanEck Green and IShares USD
The main advantage of trading using opposite VanEck Green and IShares USD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VanEck Green position performs unexpectedly, IShares USD 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 IShares USD will offset losses from the drop in IShares USD's long position.| VanEck Green vs. iShares USD Green | VanEck Green vs. First Trust California | VanEck Green vs. Great Southern Bancorp | VanEck Green vs. VanEck China Bond |
| IShares USD vs. iShares Core Total | IShares USD vs. iShares Core 1 5 | IShares USD vs. iShares Core 10 | IShares USD vs. iShares Core MSCI |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
Other Complementary Tools
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments |