Correlation Between VanEck Vectors and China Yuchai
Can any of the company-specific risk be diversified away by investing in both VanEck Vectors and China Yuchai 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 China Yuchai into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VanEck Vectors ETF and China Yuchai International, you can compare the effects of market volatilities on VanEck Vectors and China Yuchai 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 China Yuchai. Check out your portfolio center. Please also check ongoing floating volatility patterns of VanEck Vectors and China Yuchai.
Diversification Opportunities for VanEck Vectors and China Yuchai
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between VanEck and China is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Vectors ETF and China Yuchai International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Yuchai Interna 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 ETF are associated (or correlated) with China Yuchai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Yuchai Interna has no effect on the direction of VanEck Vectors i.e., VanEck Vectors and China Yuchai go up and down completely randomly.
Pair Corralation between VanEck Vectors and China Yuchai
Considering the 90-day investment horizon VanEck Vectors ETF is expected to generate 0.17 times more return on investment than China Yuchai. However, VanEck Vectors ETF is 5.77 times less risky than China Yuchai. It trades about 0.08 of its potential returns per unit of risk. China Yuchai International is currently generating about -0.51 per unit of risk. If you would invest 4,621 in VanEck Vectors ETF on August 26, 2024 and sell it today you would earn a total of 28.00 from holding VanEck Vectors ETF or generate 0.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
VanEck Vectors ETF vs. China Yuchai International
Performance |
| Timeline |
| VanEck Vectors ETF |
| China Yuchai Interna |
VanEck Vectors and China Yuchai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VanEck Vectors and China Yuchai
The main advantage of trading using opposite VanEck Vectors and China Yuchai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VanEck Vectors position performs unexpectedly, China Yuchai 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 China Yuchai will offset losses from the drop in China Yuchai's long position.| VanEck Vectors vs. Franklin Liberty Intermediate | VanEck Vectors vs. IQ MacKay Municipal | VanEck Vectors vs. Hartford Municipal Opportunities | VanEck Vectors vs. IQ MacKay Municipal |
| China Yuchai vs. China Natural Resources | China Yuchai vs. Sonida Senior Living | China Yuchai vs. UTStarcom Holdings Corp | China Yuchai vs. Deswell Industries |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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