Correlation Between VanEck Vectors and Vanguard Intermediate
Can any of the company-specific risk be diversified away by investing in both VanEck Vectors and Vanguard Intermediate 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 Vanguard Intermediate 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 Vanguard Intermediate Term Corporate, you can compare the effects of market volatilities on VanEck Vectors and Vanguard Intermediate 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 Vanguard Intermediate. Check out your portfolio center. Please also check ongoing floating volatility patterns of VanEck Vectors and Vanguard Intermediate.
Diversification Opportunities for VanEck Vectors and Vanguard Intermediate
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between VanEck and Vanguard is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Vectors Moodys and Vanguard Intermediate Term Cor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Intermediate 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 Vanguard Intermediate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard Intermediate has no effect on the direction of VanEck Vectors i.e., VanEck Vectors and Vanguard Intermediate go up and down completely randomly.
Pair Corralation between VanEck Vectors and Vanguard Intermediate
Given the investment horizon of 90 days VanEck Vectors is expected to generate 1.34 times less return on investment than Vanguard Intermediate. In addition to that, VanEck Vectors is 1.0 times more volatile than Vanguard Intermediate Term Corporate. It trades about 0.04 of its total potential returns per unit of risk. Vanguard Intermediate Term Corporate is currently generating about 0.05 per unit of volatility. If you would invest 8,013 in Vanguard Intermediate Term Corporate on November 1, 2024 and sell it today you would earn a total of 80.00 from holding Vanguard Intermediate Term Corporate or generate 1.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
VanEck Vectors Moodys vs. Vanguard Intermediate Term Cor
Performance |
| Timeline |
| VanEck Vectors Moodys |
| Vanguard Intermediate |
VanEck Vectors and Vanguard Intermediate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VanEck Vectors and Vanguard Intermediate
The main advantage of trading using opposite VanEck Vectors and Vanguard Intermediate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VanEck Vectors position performs unexpectedly, Vanguard Intermediate 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 Vanguard Intermediate will offset losses from the drop in Vanguard Intermediate'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 |
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 Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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