Correlation Between ZKB Platinum and Vanguard
Can any of the company-specific risk be diversified away by investing in both ZKB Platinum and Vanguard 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 ZKB Platinum and Vanguard into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ZKB Platinum ETF and Vanguard SP 500, you can compare the effects of market volatilities on ZKB Platinum and Vanguard 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 ZKB Platinum with a short position of Vanguard. Check out your portfolio center. Please also check ongoing floating volatility patterns of ZKB Platinum and Vanguard.
Diversification Opportunities for ZKB Platinum and Vanguard
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between ZKB and Vanguard is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding ZKB Platinum ETF and Vanguard SP 500 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard SP 500 and ZKB Platinum 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 ZKB Platinum ETF are associated (or correlated) with Vanguard. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard SP 500 has no effect on the direction of ZKB Platinum i.e., ZKB Platinum and Vanguard go up and down completely randomly.
Pair Corralation between ZKB Platinum and Vanguard
Assuming the 90 days trading horizon ZKB Platinum is expected to generate 241.73 times less return on investment than Vanguard. In addition to that, ZKB Platinum is 1.18 times more volatile than Vanguard SP 500. It trades about 0.0 of its total potential returns per unit of risk. Vanguard SP 500 is currently generating about 0.36 per unit of volatility. If you would invest 9,379 in Vanguard SP 500 on September 5, 2024 and sell it today you would earn a total of 803.00 from holding Vanguard SP 500 or generate 8.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ZKB Platinum ETF vs. Vanguard SP 500
Performance |
| Timeline |
| ZKB Platinum ETF |
| Vanguard SP 500 |
ZKB Platinum and Vanguard Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ZKB Platinum and Vanguard
The main advantage of trading using opposite ZKB Platinum and Vanguard positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ZKB Platinum position performs unexpectedly, Vanguard 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 Vanguard will offset losses from the drop in Vanguard's long position.| ZKB Platinum vs. Vanguard SP 500 | ZKB Platinum vs. iShares Core SP | ZKB Platinum vs. Lyxor Japan UCITS | ZKB Platinum vs. iShares SP 500 |
| Vanguard vs. Vanguard FTSE Emerging | Vanguard vs. Vanguard USD Emerging | Vanguard vs. Vanguard FTSE Developed | Vanguard vs. Vanguard FTSE Japan |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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