Correlation Between VanEck Intermediate and IShares National
Can any of the company-specific risk be diversified away by investing in both VanEck Intermediate and IShares National 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 Intermediate and IShares National into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VanEck Intermediate Muni and iShares National Muni, you can compare the effects of market volatilities on VanEck Intermediate and IShares National 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 Intermediate with a short position of IShares National. Check out your portfolio center. Please also check ongoing floating volatility patterns of VanEck Intermediate and IShares National.
Diversification Opportunities for VanEck Intermediate and IShares National
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between VanEck and IShares is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Intermediate Muni and iShares National Muni in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares National Muni and VanEck Intermediate 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 Intermediate Muni are associated (or correlated) with IShares National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares National Muni has no effect on the direction of VanEck Intermediate i.e., VanEck Intermediate and IShares National go up and down completely randomly.
Pair Corralation between VanEck Intermediate and IShares National
Considering the 90-day investment horizon VanEck Intermediate Muni is expected to generate 0.9 times more return on investment than IShares National. However, VanEck Intermediate Muni is 1.11 times less risky than IShares National. It trades about 0.0 of its potential returns per unit of risk. iShares National Muni is currently generating about -0.02 per unit of risk. If you would invest 4,604 in VanEck Intermediate Muni on November 5, 2024 and sell it today you would earn a total of 0.00 from holding VanEck Intermediate Muni or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
VanEck Intermediate Muni vs. iShares National Muni
Performance |
| Timeline |
| VanEck Intermediate Muni |
| iShares National Muni |
VanEck Intermediate and IShares National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VanEck Intermediate and IShares National
The main advantage of trading using opposite VanEck Intermediate and IShares National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VanEck Intermediate position performs unexpectedly, IShares National 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 National will offset losses from the drop in IShares National's long position.| VanEck Intermediate vs. VanEck Long Muni | VanEck Intermediate vs. VanEck Short Muni | VanEck Intermediate vs. SPDR Nuveen Bloomberg | VanEck Intermediate vs. Invesco National AMT Free |
| IShares National vs. iShares JP Morgan | IShares National vs. iShares iBoxx Investment | IShares National vs. SPDR Nuveen Bloomberg | IShares National vs. VanEck High Yield |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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