Correlation Between VanEck Semiconductor and Strategic Asset

Can any of the company-specific risk be diversified away by investing in both VanEck Semiconductor and Strategic Asset 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 VanEck Semiconductor and Strategic Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between VanEck Semiconductor ETF and Strategic Asset Leasing, you can compare the effects of market volatilities on VanEck Semiconductor and Strategic Asset 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 VanEck Semiconductor with a short position of Strategic Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of VanEck Semiconductor and Strategic Asset.

Diversification Opportunities for VanEck Semiconductor and Strategic Asset

0.0

Correlation Coefficient

VanEck Semiconductor  Strategic Asset

Pay attention - limited upside

The 3 months correlation between VanEck and Strategic is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Semiconductor ETF and Strategic Asset Leasing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strategic Asset Leasing and VanEck Semiconductor 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 VanEck Semiconductor ETF are associated (or correlated) with Strategic Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strategic Asset Leasing has no effect on the direction of VanEck Semiconductor i.e., VanEck Semiconductor and Strategic Asset go up and down completely randomly.

Pair Corralation between VanEck Semiconductor and Strategic Asset

If you would invest  0.08  in Strategic Asset Leasing on January 20, 2024 and sell it today you would earn a total of  0.00  from holding Strategic Asset Leasing or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

VanEck Semiconductor ETF  vs.  Strategic Asset Leasing

VanEck Semiconductor ETF

Risk-Adjusted Performance

0 of 100

OK

Over the last 90 days VanEck Semiconductor ETF has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong primary indicators, VanEck Semiconductor is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Strategic Asset Leasing

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Strategic Asset Leasing has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, Strategic Asset is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with VanEck Semiconductor and Strategic Asset

The main advantage of trading using opposite VanEck Semiconductor and Strategic Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VanEck Semiconductor position performs unexpectedly, Strategic Asset 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 Strategic Asset will offset losses from the drop in Strategic Asset's long position.

The idea behind VanEck Semiconductor ETF and Strategic Asset Leasing pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.