Correlation Between VanEck Vectors and US Commodity
Can any of the company-specific risk be diversified away by investing in both VanEck Vectors and US Commodity 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 Vectors and US Commodity into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VanEck Vectors Moodys and US Commodity Funds, you can compare the effects of market volatilities on VanEck Vectors and US Commodity 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 Vectors with a short position of US Commodity. Check out your portfolio center. Please also check ongoing floating volatility patterns of VanEck Vectors and US Commodity.
Diversification Opportunities for VanEck Vectors and US Commodity
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between VanEck and ALUM is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Vectors Moodys and US Commodity Funds in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on US Commodity Funds and VanEck Vectors 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 Vectors Moodys are associated (or correlated) with US Commodity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of US Commodity Funds has no effect on the direction of VanEck Vectors i.e., VanEck Vectors and US Commodity go up and down completely randomly.
Pair Corralation between VanEck Vectors and US Commodity
Given the investment horizon of 90 days VanEck Vectors is expected to generate 2.96 times less return on investment than US Commodity. But when comparing it to its historical volatility, VanEck Vectors Moodys is 5.39 times less risky than US Commodity. It trades about 0.1 of its potential returns per unit of risk. US Commodity Funds is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 2,816 in US Commodity Funds on September 3, 2024 and sell it today you would earn a total of 505.00 from holding US Commodity Funds or generate 17.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 80.16% |
| Values | Daily Returns |
VanEck Vectors Moodys vs. US Commodity Funds
Performance |
| Timeline |
| VanEck Vectors Moodys |
| US Commodity Funds |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
VanEck Vectors and US Commodity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VanEck Vectors and US Commodity
The main advantage of trading using opposite VanEck Vectors and US Commodity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VanEck Vectors position performs unexpectedly, US Commodity 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 US Commodity will offset losses from the drop in US Commodity's long position.| VanEck Vectors vs. iShares iBonds 2026 | VanEck Vectors vs. iShares BBB Rated | VanEck Vectors vs. iShares iBonds Dec | VanEck Vectors vs. iShares 25 Year |
| US Commodity vs. FT Vest Equity | US Commodity vs. Zillow Group Class | US Commodity vs. Northern Lights | US Commodity vs. VanEck Vectors Moodys |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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