Vanguard Materials Index Etf Volatility
| VAW Etf | USD 209.38 2.83 1.37% |
At this stage we consider Vanguard Etf to be very steady. Vanguard Materials Index owns Efficiency Ratio (i.e., Sharpe Ratio) of 0.0542, which indicates the etf had a 0.0542% return per unit of risk over the last 3 months. We have found thirty technical indicators for Vanguard Materials Index, which you can use to evaluate the volatility of the etf. Please validate Vanguard Materials' Coefficient Of Variation of 1269.93, semi deviation of 0.7557, and Risk Adjusted Performance of 0.0608 to confirm if the risk estimate we provide is consistent with the expected return of 0.0481%. Key indicators related to Vanguard Materials' volatility include:
30 Days Market Risk | Chance Of Distress | 30 Days Economic Sensitivity |
Vanguard Materials Etf volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Vanguard daily returns, and it is calculated using variance and standard deviation. We also use Vanguard's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Vanguard Materials volatility.
Vanguard |
Downward market volatility can be a perfect environment for investors who play the long game with Vanguard Materials. They may decide to buy additional shares of Vanguard Materials at lower prices to lower the average cost per share, thereby improving their portfolio's performance when markets normalize.
Moving together with Vanguard Etf
| 0.74 | EV | Mast Global Battery | PairCorr |
| 0.94 | XLB | Materials Select Sector | PairCorr |
| 0.84 | XME | SPDR SP Metals | PairCorr |
| 0.84 | PHO | Invesco Water Resources | PairCorr |
| 0.9 | FXZ | First Trust Materials | PairCorr |
| 0.87 | FIW | First Trust Water | PairCorr |
| 0.86 | URNM | Sprott Uranium Miners | PairCorr |
Vanguard Materials Market Sensitivity And Downside Risk
Vanguard Materials' beta coefficient measures the volatility of Vanguard etf compared to the systematic risk of the entire market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Vanguard etf's returns against your selected market. In other words, Vanguard Materials's beta of 0.89 provides an investor with an approximation of how much risk Vanguard Materials etf can potentially add to one of your existing portfolios. Vanguard Materials Index has low volatility with Treynor Ratio of 0.07, Maximum Drawdown of 4.13 and kurtosis of 0.4. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Vanguard Materials' etf risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Vanguard Materials' etf price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different financial instruments as prices fall.
3 Months Beta |Analyze Vanguard Materials Index Demand TrendCheck current 90 days Vanguard Materials correlation with market (Dow Jones Industrial)Vanguard Beta |
Vanguard standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. A typical volatile entity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.
Standard Deviation | 0.89 |
It is essential to understand the difference between upside risk (as represented by Vanguard Materials's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Vanguard Materials' daily returns or price. Since the actual investment returns on holding a position in vanguard etf tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Vanguard Materials.
Vanguard Materials Index Etf Volatility Analysis
Volatility refers to the frequency at which Vanguard Materials etf price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Vanguard Materials' price changes. Investors will then calculate the volatility of Vanguard Materials' etf to predict their future moves. A etf that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A etf with relatively stable price changes has low volatility. A highly volatile etf is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Vanguard Materials' volatility:
Historical Volatility
This type of etf volatility measures Vanguard Materials' fluctuations based on previous trends. It's commonly used to predict Vanguard Materials' future behavior based on its past. However, it cannot conclusively determine the future direction of the etf.Implied Volatility
This type of volatility provides a positive outlook on future price fluctuations for Vanguard Materials' current market price. This means that the etf will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on Vanguard Materials' to be redeemed at a future date.Transformation |
The output start index for this execution was zero with a total number of output elements of sixty-one. Vanguard Materials Index Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input.
Vanguard Materials Projected Return Density Against Market
Considering the 90-day investment horizon Vanguard Materials has a beta of 0.8898 . This entails Vanguard Materials Index market returns are correlated to returns on the market. As the market goes up or down, Vanguard Materials is expected to follow.Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Vanguard Materials or Vanguard sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Vanguard Materials' price will be affected by overall etf market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Vanguard etf's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
Vanguard Materials Index has a negative alpha, implying that the risk taken by holding this instrument is not justified. The company is significantly underperforming the Dow Jones Industrial. Predicted Return Density |
| Returns |
What Drives a Vanguard Materials Price Volatility?
Several factors can influence a etf's market volatility:Industry
Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.Political and Economic environment
When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.The Company's Performance
Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.Vanguard Materials Etf Risk Measures
Considering the 90-day investment horizon the coefficient of variation of Vanguard Materials is 1844.21. The daily returns are distributed with a variance of 0.79 and standard deviation of 0.89. The mean deviation of Vanguard Materials Index is currently at 0.7. For similar time horizon, the selected benchmark (Dow Jones Industrial) has volatility of 0.75
α | Alpha over Dow Jones | -0.02 | |
β | Beta against Dow Jones | 0.89 | |
σ | Overall volatility | 0.89 | |
Ir | Information ratio | -0.03 |
Vanguard Materials Etf Return Volatility
Vanguard Materials historical daily return volatility represents how much of Vanguard Materials etf's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The fund has volatility of 0.8866% on return distribution over 90 days investment horizon. By contrast, Dow Jones Industrial accepts 0.7668% volatility on return distribution over the 90 days horizon. Performance |
| Timeline |
About Vanguard Materials Volatility
Volatility is a rate at which the price of Vanguard Materials or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Vanguard Materials may increase or decrease. In other words, similar to Vanguard's beta indicator, it measures the risk of Vanguard Materials and helps estimate the fluctuations that may happen in a short period of time. So if prices of Vanguard Materials fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.The fund employs an indexing investment approach designed to track the performance of the MSCI US Investable Market Index Materials 2550, an index made up of stocks of large, mid-size, and small U.S. companies within the materials sector, as classified under the Global Industry Classification Standard . Vanguard Materials is traded on NYSEARCA Exchange in the United States.
Vanguard Materials' stock volatility refers to the amount of uncertainty or risk involved with the size of changes in its stock's price. It is a statistical measure of the dispersion of returns on Vanguard Etf over a specified period of time, often expressed as the standard deviation of daily returns. In other words, it measures how much Vanguard Materials' price varies over time.
3 ways to utilize Vanguard Materials' volatility to invest better
Higher Vanguard Materials' etf volatility means that the price of its stock is changing rapidly and unpredictably, while lower stock volatility indicates that the price of Vanguard Materials Index etf is relatively stable. Investors and traders use stock volatility as an indicator of risk and potential reward, as stocks with higher volatility can offer the potential for more significant returns but also come with a greater risk of losses. Vanguard Materials Index etf volatility can provide helpful information for making investment decisions in the following ways:- Measuring Risk: Volatility can be used as a measure of risk, which can help you determine the potential fluctuations in the value of Vanguard Materials Index investment. A higher volatility means higher risk and potentially larger changes in value.
- Identifying Opportunities: High volatility in Vanguard Materials' etf can indicate that there is potential for significant price movements, either up or down, which could present investment opportunities.
- Diversification: Understanding how the volatility of Vanguard Materials' etf relates to your other investments can help you create a well-diversified portfolio of assets with varying levels of risk.
Vanguard Materials Investment Opportunity
Vanguard Materials Index has a volatility of 0.89 and is 1.16 times more volatile than Dow Jones Industrial. Compared to the overall equity markets, volatility of historical daily returns of Vanguard Materials Index is lower than 7 percent of all global equities and portfolios over the last 90 days. You can use Vanguard Materials Index to enhance the returns of your portfolios. The etf experiences a large bullish trend. Check odds of Vanguard Materials to be traded at $230.32 in 90 days.Poor diversification
The correlation between Vanguard Materials Index and DJI is 0.76 (i.e., Poor diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Vanguard Materials Index and DJI in the same portfolio, assuming nothing else is changed.
Vanguard Materials Additional Risk Indicators
The analysis of Vanguard Materials' secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Vanguard Materials' investment and either accepting that risk or mitigating it. Along with some common measures of Vanguard Materials etf's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
| Risk Adjusted Performance | 0.0608 | |||
| Market Risk Adjusted Performance | 0.0772 | |||
| Mean Deviation | 0.7056 | |||
| Semi Deviation | 0.7557 | |||
| Downside Deviation | 0.8396 | |||
| Coefficient Of Variation | 1269.93 | |||
| Standard Deviation | 0.8861 |
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential etfs, we recommend comparing similar etfs with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.
Vanguard Materials Suggested Diversification Pairs
Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Vanguard Materials as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Vanguard Materials' systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Vanguard Materials' unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Vanguard Materials Index.
When determining whether Vanguard Materials Index is a strong investment it is important to analyze Vanguard Materials' competitive position within its industry, examining market share, product or service uniqueness, and competitive advantages. Beyond financials and market position, potential investors should also consider broader economic conditions, industry trends, and any regulatory or geopolitical factors that may impact Vanguard Materials' future performance. For an informed investment choice regarding Vanguard Etf, refer to the following important reports: Check out World Market Map to better understand how to build diversified portfolios, which includes a position in Vanguard Materials Index. Also, note that the market value of any etf could be closely tied with the direction of predictive economic indicators such as signals in nation. You can also try the Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
The market value of Vanguard Materials Index is measured differently than its book value, which is the value of Vanguard that is recorded on the company's balance sheet. Investors also form their own opinion of Vanguard Materials' value that differs from its market value or its book value, called intrinsic value, which is Vanguard Materials' true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Vanguard Materials' market value can be influenced by many factors that don't directly affect Vanguard Materials' underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Vanguard Materials' value and its price as these two are different measures arrived at by different means. Investors typically determine if Vanguard Materials is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Vanguard Materials' price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.