Correlation Between Mountain Crest and VanEck ETF
Can any of the company-specific risk be diversified away by investing in both Mountain Crest and VanEck ETF 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 Mountain Crest and VanEck ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mountain Crest Acquisition and VanEck ETF Trust, you can compare the effects of market volatilities on Mountain Crest and VanEck ETF 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 Mountain Crest with a short position of VanEck ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mountain Crest and VanEck ETF.
Diversification Opportunities for Mountain Crest and VanEck ETF
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Mountain and VanEck is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Mountain Crest Acquisition and VanEck ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VanEck ETF Trust and Mountain Crest 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 Mountain Crest Acquisition are associated (or correlated) with VanEck ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VanEck ETF Trust has no effect on the direction of Mountain Crest i.e., Mountain Crest and VanEck ETF go up and down completely randomly.
Pair Corralation between Mountain Crest and VanEck ETF
If you would invest 3,763 in VanEck ETF Trust on September 3, 2024 and sell it today you would earn a total of 757.00 from holding VanEck ETF Trust or generate 20.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 0.8% |
| Values | Daily Returns |
Mountain Crest Acquisition vs. VanEck ETF Trust
Performance |
| Timeline |
| Mountain Crest Acqui |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| VanEck ETF Trust |
Mountain Crest and VanEck ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mountain Crest and VanEck ETF
The main advantage of trading using opposite Mountain Crest and VanEck ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mountain Crest position performs unexpectedly, VanEck ETF 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 ETF will offset losses from the drop in VanEck ETF's long position.The idea behind Mountain Crest Acquisition and VanEck ETF Trust pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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