Correlation Between VictoryShares THB and Tema ETF
Can any of the company-specific risk be diversified away by investing in both VictoryShares THB and Tema 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 VictoryShares THB and Tema ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VictoryShares THB Mid and Tema ETF Trust, you can compare the effects of market volatilities on VictoryShares THB and Tema 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 VictoryShares THB with a short position of Tema ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of VictoryShares THB and Tema ETF.
Diversification Opportunities for VictoryShares THB and Tema ETF
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between VictoryShares and Tema is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding VictoryShares THB Mid and Tema ETF Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tema ETF Trust and VictoryShares THB 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 VictoryShares THB Mid are associated (or correlated) with Tema ETF. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tema ETF Trust has no effect on the direction of VictoryShares THB i.e., VictoryShares THB and Tema ETF go up and down completely randomly.
Pair Corralation between VictoryShares THB and Tema ETF
Given the investment horizon of 90 days VictoryShares THB is expected to generate 1.22 times less return on investment than Tema ETF. But when comparing it to its historical volatility, VictoryShares THB Mid is 1.64 times less risky than Tema ETF. It trades about 0.24 of its potential returns per unit of risk. Tema ETF Trust is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 3,702 in Tema ETF Trust on November 3, 2024 and sell it today you would earn a total of 193.00 from holding Tema ETF Trust or generate 5.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
VictoryShares THB Mid vs. Tema ETF Trust
Performance |
| Timeline |
| VictoryShares THB Mid |
| Tema ETF Trust |
VictoryShares THB and Tema ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VictoryShares THB and Tema ETF
The main advantage of trading using opposite VictoryShares THB and Tema ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VictoryShares THB position performs unexpectedly, Tema 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 Tema ETF will offset losses from the drop in Tema ETF's long position.| VictoryShares THB vs. iShares Dividend and | VictoryShares THB vs. Martin Currie Sustainable | VictoryShares THB vs. Mast Global Battery | VictoryShares THB vs. AdvisorShares Gerber Kawasaki |
| Tema ETF vs. iShares Dividend and | Tema ETF vs. Martin Currie Sustainable | Tema ETF vs. VictoryShares THB Mid | Tema ETF vs. Mast Global Battery |
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 Channel module to use Commodity Channel Index to analyze current equity momentum.
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