Correlation Between VanEck Vectors and MYMF
Can any of the company-specific risk be diversified away by investing in both VanEck Vectors and MYMF 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 MYMF 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 MYMF, you can compare the effects of market volatilities on VanEck Vectors and MYMF 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 MYMF. Check out your portfolio center. Please also check ongoing floating volatility patterns of VanEck Vectors and MYMF.
Diversification Opportunities for VanEck Vectors and MYMF
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between VanEck and MYMF is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Vectors Moodys and MYMF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MYMF 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 MYMF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MYMF has no effect on the direction of VanEck Vectors i.e., VanEck Vectors and MYMF go up and down completely randomly.
Pair Corralation between VanEck Vectors and MYMF
Given the investment horizon of 90 days VanEck Vectors Moodys is expected to generate 2.85 times more return on investment than MYMF. However, VanEck Vectors is 2.85 times more volatile than MYMF. It trades about 0.14 of its potential returns per unit of risk. MYMF is currently generating about 0.17 per unit of risk. If you would invest 2,145 in VanEck Vectors Moodys on September 4, 2024 and sell it today you would earn a total of 24.00 from holding VanEck Vectors Moodys or generate 1.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
VanEck Vectors Moodys vs. MYMF
Performance |
| Timeline |
| VanEck Vectors Moodys |
| MYMF |
VanEck Vectors and MYMF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VanEck Vectors and MYMF
The main advantage of trading using opposite VanEck Vectors and MYMF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VanEck Vectors position performs unexpectedly, MYMF 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 MYMF will offset losses from the drop in MYMF's long position.| VanEck Vectors vs. iShares iBoxx High | VanEck Vectors vs. iShares 1 3 Year | VanEck Vectors vs. iShares TIPS Bond | VanEck Vectors vs. iShares 7 10 Year |
| MYMF vs. VanEck Vectors Moodys | MYMF vs. Xtrackers California Municipal | MYMF vs. Vanguard ESG Corporate | MYMF vs. Vanguard Intermediate Term Corporate |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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