Correlation Between VanEck Short and VanEck Intermediate
Can any of the company-specific risk be diversified away by investing in both VanEck Short and VanEck 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 Short and VanEck Intermediate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VanEck Short Muni and VanEck Intermediate Muni, you can compare the effects of market volatilities on VanEck Short and VanEck 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 Short with a short position of VanEck Intermediate. Check out your portfolio center. Please also check ongoing floating volatility patterns of VanEck Short and VanEck Intermediate.
Diversification Opportunities for VanEck Short and VanEck Intermediate
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between VanEck and VanEck is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Short Muni and VanEck Intermediate Muni in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VanEck Intermediate Muni and VanEck Short 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 Short Muni are associated (or correlated) with VanEck Intermediate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VanEck Intermediate Muni has no effect on the direction of VanEck Short i.e., VanEck Short and VanEck Intermediate go up and down completely randomly.
Pair Corralation between VanEck Short and VanEck Intermediate
Considering the 90-day investment horizon VanEck Short is expected to generate 1.38 times less return on investment than VanEck Intermediate. But when comparing it to its historical volatility, VanEck Short Muni is 2.9 times less risky than VanEck Intermediate. It trades about 0.11 of its potential returns per unit of risk. VanEck Intermediate Muni is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 4,601 in VanEck Intermediate Muni on August 27, 2024 and sell it today you would earn a total of 18.00 from holding VanEck Intermediate Muni or generate 0.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
VanEck Short Muni vs. VanEck Intermediate Muni
Performance |
| Timeline |
| VanEck Short Muni |
| VanEck Intermediate Muni |
VanEck Short and VanEck Intermediate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VanEck Short and VanEck Intermediate
The main advantage of trading using opposite VanEck Short and VanEck Intermediate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VanEck Short position performs unexpectedly, VanEck 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 VanEck Intermediate will offset losses from the drop in VanEck Intermediate's long position.| VanEck Short vs. SSGA Active Trust | VanEck Short vs. SPDR Nuveen Municipal | VanEck Short vs. Xtrackers California Municipal | VanEck Short vs. iShares Short Maturity |
| VanEck Intermediate vs. SSGA Active Trust | VanEck Intermediate vs. SPDR MarketAxess Investment | VanEck Intermediate vs. SSGA Active Trust |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years |