Correlation Between SCOR PK and VanEck ETF
Can any of the company-specific risk be diversified away by investing in both SCOR PK 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 SCOR PK and VanEck ETF into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SCOR PK and VanEck ETF Trust, you can compare the effects of market volatilities on SCOR PK 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 SCOR PK with a short position of VanEck ETF. Check out your portfolio center. Please also check ongoing floating volatility patterns of SCOR PK and VanEck ETF.
Diversification Opportunities for SCOR PK and VanEck ETF
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between SCOR and VanEck is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding SCOR PK 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 SCOR PK 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 SCOR PK 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 SCOR PK i.e., SCOR PK and VanEck ETF go up and down completely randomly.
Pair Corralation between SCOR PK and VanEck ETF
Assuming the 90 days horizon SCOR PK is expected to generate 62.24 times more return on investment than VanEck ETF. However, SCOR PK is 62.24 times more volatile than VanEck ETF Trust. It trades about 0.27 of its potential returns per unit of risk. VanEck ETF Trust is currently generating about 0.58 per unit of risk. If you would invest 214.00 in SCOR PK on September 4, 2024 and sell it today you would earn a total of 34.00 from holding SCOR PK or generate 15.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
SCOR PK vs. VanEck ETF Trust
Performance |
| Timeline |
| SCOR PK |
| VanEck ETF Trust |
SCOR PK and VanEck ETF Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SCOR PK and VanEck ETF
The main advantage of trading using opposite SCOR PK and VanEck ETF positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SCOR PK 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 SCOR PK 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.| VanEck ETF vs. SCOR PK | VanEck ETF vs. HUMANA INC | VanEck ETF vs. Aquagold International | VanEck ETF vs. Barloworld Ltd ADR |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Stocks Directory Find actively traded stocks across global markets | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio |