Correlation Between VanEck Vectors and SoFi Next
Can any of the company-specific risk be diversified away by investing in both VanEck Vectors and SoFi Next 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 SoFi Next 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 SoFi Next 500, you can compare the effects of market volatilities on VanEck Vectors and SoFi Next 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 SoFi Next. Check out your portfolio center. Please also check ongoing floating volatility patterns of VanEck Vectors and SoFi Next.
Diversification Opportunities for VanEck Vectors and SoFi Next
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between VanEck and SoFi is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Vectors ETF and SoFi Next 500 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SoFi Next 500 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 SoFi Next. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SoFi Next 500 has no effect on the direction of VanEck Vectors i.e., VanEck Vectors and SoFi Next go up and down completely randomly.
Pair Corralation between VanEck Vectors and SoFi Next
Considering the 90-day investment horizon VanEck Vectors is expected to generate 9.93 times less return on investment than SoFi Next. But when comparing it to its historical volatility, VanEck Vectors ETF is 3.8 times less risky than SoFi Next. It trades about 0.11 of its potential returns per unit of risk. SoFi Next 500 is currently generating about 0.3 of returns per unit of risk over similar time horizon. If you would invest 1,434 in SoFi Next 500 on September 4, 2024 and sell it today you would earn a total of 133.00 from holding SoFi Next 500 or generate 9.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
VanEck Vectors ETF vs. SoFi Next 500
Performance |
| Timeline |
| VanEck Vectors ETF |
| SoFi Next 500 |
VanEck Vectors and SoFi Next Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VanEck Vectors and SoFi Next
The main advantage of trading using opposite VanEck Vectors and SoFi Next positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VanEck Vectors position performs unexpectedly, SoFi Next 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 SoFi Next will offset losses from the drop in SoFi Next's long position.| VanEck Vectors vs. Formidable Fortress ETF | VanEck Vectors vs. Sonida Senior Living | VanEck Vectors vs. China Yuchai International | VanEck Vectors vs. Nine Energy Service |
| SoFi Next vs. Sonida Senior Living | SoFi Next vs. The9 Ltd ADR | SoFi Next vs. VanEck Vectors ETF | SoFi Next vs. Nine Energy Service |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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