Correlation Between VanEck Vectors and VanEck Emerging
Can any of the company-specific risk be diversified away by investing in both VanEck Vectors and VanEck Emerging 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 VanEck Emerging 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 VanEck Emerging Markets, you can compare the effects of market volatilities on VanEck Vectors and VanEck Emerging 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 VanEck Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of VanEck Vectors and VanEck Emerging.
Diversification Opportunities for VanEck Vectors and VanEck Emerging
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between VanEck and VanEck is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Vectors Moodys and VanEck Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VanEck Emerging Markets 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 VanEck Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VanEck Emerging Markets has no effect on the direction of VanEck Vectors i.e., VanEck Vectors and VanEck Emerging go up and down completely randomly.
Pair Corralation between VanEck Vectors and VanEck Emerging
Given the investment horizon of 90 days VanEck Vectors is expected to generate 1.99 times less return on investment than VanEck Emerging. In addition to that, VanEck Vectors is 1.34 times more volatile than VanEck Emerging Markets. It trades about 0.1 of its total potential returns per unit of risk. VanEck Emerging Markets is currently generating about 0.28 per unit of volatility. If you would invest 1,951 in VanEck Emerging Markets on November 2, 2024 and sell it today you would earn a total of 26.00 from holding VanEck Emerging Markets or generate 1.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
VanEck Vectors Moodys vs. VanEck Emerging Markets
Performance |
| Timeline |
| VanEck Vectors Moodys |
| VanEck Emerging Markets |
VanEck Vectors and VanEck Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VanEck Vectors and VanEck Emerging
The main advantage of trading using opposite VanEck Vectors and VanEck Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VanEck Vectors position performs unexpectedly, VanEck Emerging 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 Emerging will offset losses from the drop in VanEck Emerging'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 |
| VanEck Emerging vs. BondBloxx ETF Trust | VanEck Emerging vs. Virtus ETF Trust | VanEck Emerging vs. Virtus ETF Trust | VanEck Emerging vs. WisdomTree Emerging Markets |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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