Correlation Between Innovator ETFs and VanEck Oil
Can any of the company-specific risk be diversified away by investing in both Innovator ETFs and VanEck Oil 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 Innovator ETFs and VanEck Oil into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Innovator ETFs Trust and VanEck Oil Refiners, you can compare the effects of market volatilities on Innovator ETFs and VanEck Oil 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 Innovator ETFs with a short position of VanEck Oil. Check out your portfolio center. Please also check ongoing floating volatility patterns of Innovator ETFs and VanEck Oil.
Diversification Opportunities for Innovator ETFs and VanEck Oil
-0.78 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Innovator and VanEck is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding Innovator ETFs Trust and VanEck Oil Refiners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VanEck Oil Refiners and Innovator ETFs 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 Innovator ETFs Trust are associated (or correlated) with VanEck Oil. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VanEck Oil Refiners has no effect on the direction of Innovator ETFs i.e., Innovator ETFs and VanEck Oil go up and down completely randomly.
Pair Corralation between Innovator ETFs and VanEck Oil
Given the investment horizon of 90 days Innovator ETFs Trust is expected to generate 0.43 times more return on investment than VanEck Oil. However, Innovator ETFs Trust is 2.34 times less risky than VanEck Oil. It trades about 0.15 of its potential returns per unit of risk. VanEck Oil Refiners is currently generating about -0.01 per unit of risk. If you would invest 2,440 in Innovator ETFs Trust on September 2, 2024 and sell it today you would earn a total of 399.00 from holding Innovator ETFs Trust or generate 16.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Innovator ETFs Trust vs. VanEck Oil Refiners
Performance |
| Timeline |
| Innovator ETFs Trust |
| VanEck Oil Refiners |
Innovator ETFs and VanEck Oil Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Innovator ETFs and VanEck Oil
The main advantage of trading using opposite Innovator ETFs and VanEck Oil positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Innovator ETFs position performs unexpectedly, VanEck Oil 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 Oil will offset losses from the drop in VanEck Oil's long position.| Innovator ETFs vs. Innovator ETFs Trust | Innovator ETFs vs. Innovator Equity Accelerated | Innovator ETFs vs. Innovator ETFs Trust | Innovator ETFs vs. Innovator ETFs Trust |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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