Correlation Between SP 500 and Vaneck Vectors
Can any of the company-specific risk be diversified away by investing in both SP 500 and Vaneck Vectors 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 SP 500 and Vaneck Vectors into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SP 500 VIX and Vaneck Vectors UCITS, you can compare the effects of market volatilities on SP 500 and Vaneck Vectors 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 SP 500 with a short position of Vaneck Vectors. Check out your portfolio center. Please also check ongoing floating volatility patterns of SP 500 and Vaneck Vectors.
Diversification Opportunities for SP 500 and Vaneck Vectors
-0.3 | Correlation Coefficient |
Very good diversification
The 3 months correlation between VILX and Vaneck is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding SP 500 VIX and Vaneck Vectors UCITS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vaneck Vectors UCITS and SP 500 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 SP 500 VIX are associated (or correlated) with Vaneck Vectors. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vaneck Vectors UCITS has no effect on the direction of SP 500 i.e., SP 500 and Vaneck Vectors go up and down completely randomly.
Pair Corralation between SP 500 and Vaneck Vectors
Assuming the 90 days trading horizon SP 500 VIX is expected to generate 116.78 times more return on investment than Vaneck Vectors. However, SP 500 is 116.78 times more volatile than Vaneck Vectors UCITS. It trades about 0.03 of its potential returns per unit of risk. Vaneck Vectors UCITS is currently generating about 0.04 per unit of risk. If you would invest 5,115 in SP 500 VIX on September 4, 2024 and sell it today you would earn a total of 156,628 from holding SP 500 VIX or generate 3062.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SP 500 VIX vs. Vaneck Vectors UCITS
Performance |
| Timeline |
| SP 500 VIX |
| Vaneck Vectors UCITS |
SP 500 and Vaneck Vectors Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SP 500 and Vaneck Vectors
The main advantage of trading using opposite SP 500 and Vaneck Vectors positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SP 500 position performs unexpectedly, Vaneck Vectors 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 Vectors will offset losses from the drop in Vaneck Vectors' long position.| SP 500 vs. GraniteShares 3x Short | SP 500 vs. WisdomTree Natural Gas | SP 500 vs. Leverage Shares 3x | SP 500 vs. WisdomTree Natural Gas |
| Vaneck Vectors vs. Leverage Shares 3x | Vaneck Vectors vs. WisdomTree Natural Gas | Vaneck Vectors vs. SP 500 VIX | Vaneck Vectors vs. Leverage Shares 3x |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity |