Correlation Between Van Eck and Global X
Can any of the company-specific risk be diversified away by investing in both Van Eck and Global X 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 Van Eck and Global X into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Van Eck and Global X Hydrogen, you can compare the effects of market volatilities on Van Eck and Global X 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 Van Eck with a short position of Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of Van Eck and Global X.
Diversification Opportunities for Van Eck and Global X
Very good diversification
The 3 months correlation between Van and Global is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Van Eck and Global X Hydrogen in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X Hydrogen and Van Eck 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 Van Eck are associated (or correlated) with Global X. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global X Hydrogen has no effect on the direction of Van Eck i.e., Van Eck and Global X go up and down completely randomly.
Pair Corralation between Van Eck and Global X
Considering the 90-day investment horizon Van Eck is expected to generate 0.19 times more return on investment than Global X. However, Van Eck is 5.22 times less risky than Global X. It trades about 0.07 of its potential returns per unit of risk. Global X Hydrogen is currently generating about -0.06 per unit of risk. If you would invest 2,383 in Van Eck on September 3, 2024 and sell it today you would earn a total of 384.00 from holding Van Eck or generate 16.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 93.13% |
| Values | Daily Returns |
Van Eck vs. Global X Hydrogen
Performance |
| Timeline |
| Van Eck |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Solid
| Global X Hydrogen |
Van Eck and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Van Eck and Global X
The main advantage of trading using opposite Van Eck and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Van Eck position performs unexpectedly, Global X 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 Global X will offset losses from the drop in Global X's long position.| Van Eck vs. PIMCO Investment Grade | Van Eck vs. Direxion Auspice Broad | Van Eck vs. Sprott Focus Trust | Van Eck vs. Simplify Exchange Traded |
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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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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