Correlation Between VIIX and Energy Select
Can any of the company-specific risk be diversified away by investing in both VIIX and Energy Select 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 VIIX and Energy Select into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between VIIX and Energy Select Sector, you can compare the effects of market volatilities on VIIX and Energy Select 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 VIIX with a short position of Energy Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of VIIX and Energy Select.
Diversification Opportunities for VIIX and Energy Select
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between VIIX and Energy is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding VIIX and Energy Select Sector in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Energy Select Sector and VIIX 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 VIIX are associated (or correlated) with Energy Select. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Energy Select Sector has no effect on the direction of VIIX i.e., VIIX and Energy Select go up and down completely randomly.
Pair Corralation between VIIX and Energy Select
If you would invest 8,219 in Energy Select Sector on August 27, 2024 and sell it today you would earn a total of 1,508 from holding Energy Select Sector or generate 18.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 0.4% |
| Values | Daily Returns |
VIIX vs. Energy Select Sector
Performance |
| Timeline |
| VIIX |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Energy Select Sector |
VIIX and Energy Select Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with VIIX and Energy Select
The main advantage of trading using opposite VIIX and Energy Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VIIX position performs unexpectedly, Energy Select 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 Energy Select will offset losses from the drop in Energy Select's long position.| VIIX vs. FT Vest Equity | VIIX vs. Zillow Group Class | VIIX vs. Northern Lights | VIIX vs. VanEck Vectors Moodys |
| Energy Select vs. Financial Select Sector | Energy Select vs. Health Care Select | Energy Select vs. Technology Select Sector | Energy Select vs. Utilities Select Sector |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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