Correlation Between Vanguard Total and ETFS Battery
Can any of the company-specific risk be diversified away by investing in both Vanguard Total and ETFS Battery 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 Vanguard Total and ETFS Battery into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Vanguard Total Market and ETFS Battery Tech, you can compare the effects of market volatilities on Vanguard Total and ETFS Battery 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 Vanguard Total with a short position of ETFS Battery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Vanguard Total and ETFS Battery.
Diversification Opportunities for Vanguard Total and ETFS Battery
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Vanguard and ETFS is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Total Market and ETFS Battery Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ETFS Battery Tech and Vanguard Total 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 Vanguard Total Market are associated (or correlated) with ETFS Battery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ETFS Battery Tech has no effect on the direction of Vanguard Total i.e., Vanguard Total and ETFS Battery go up and down completely randomly.
Pair Corralation between Vanguard Total and ETFS Battery
Assuming the 90 days trading horizon Vanguard Total Market is expected to generate 0.81 times more return on investment than ETFS Battery. However, Vanguard Total Market is 1.23 times less risky than ETFS Battery. It trades about 0.28 of its potential returns per unit of risk. ETFS Battery Tech is currently generating about -0.01 per unit of risk. If you would invest 43,458 in Vanguard Total Market on September 1, 2024 and sell it today you would earn a total of 2,495 from holding Vanguard Total Market or generate 5.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Vanguard Total Market vs. ETFS Battery Tech
Performance |
| Timeline |
| Vanguard Total Market |
| ETFS Battery Tech |
Vanguard Total and ETFS Battery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Vanguard Total and ETFS Battery
The main advantage of trading using opposite Vanguard Total and ETFS Battery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Vanguard Total position performs unexpectedly, ETFS Battery 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 ETFS Battery will offset losses from the drop in ETFS Battery's long position.| Vanguard Total vs. ETFS Morningstar Global | Vanguard Total vs. BetaShares Geared Equity | Vanguard Total vs. VanEck Vectors Australian | Vanguard Total vs. SPDR SPASX 200 |
| ETFS Battery vs. ETFS Ultra Long | ETFS Battery vs. ETFS Ultra Short | ETFS Battery vs. ETFS FANG ETF | ETFS Battery vs. ETFS SP Biotech |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
Other Complementary Tools
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |