Correlation Between Leverage Shares and VanEck Crypto

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

By analyzing existing cross correlation between Leverage Shares 2x and VanEck Crypto Blockchain, you can compare the effects of market volatilities on Leverage Shares and VanEck Crypto 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 Leverage Shares with a short position of VanEck Crypto. Check out your portfolio center. Please also check ongoing floating volatility patterns of Leverage Shares and VanEck Crypto.

Diversification Opportunities for Leverage Shares and VanEck Crypto

-0.8

Correlation Coefficient

Leverage Shares  VanEck Crypto

Pay attention - limited upside

The 3 months correlation between Leverage and VanEck is -0.8. Overlapping area represents the amount of risk that can be diversified away by holding Leverage Shares 2x and VanEck Crypto Blockchain in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VanEck Crypto Blockchain and Leverage Shares 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 Leverage Shares 2x are associated (or correlated) with VanEck Crypto. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VanEck Crypto Blockchain has no effect on the direction of Leverage Shares i.e., Leverage Shares and VanEck Crypto go up and down completely randomly.

Pair Corralation between Leverage Shares and VanEck Crypto

Assuming the 90 days trading horizon Leverage Shares is expected to generate 1.53 times less return on investment than VanEck Crypto. In addition to that, Leverage Shares is 1.17 times more volatile than VanEck Crypto Blockchain. It trades about 0.06 of its total potential returns per unit of risk. VanEck Crypto Blockchain is currently generating about 0.1 per unit of volatility. If you would invest  179.00  in VanEck Crypto Blockchain on September 14, 2024 and sell it today you would earn a total of  1,112  from holding VanEck Crypto Blockchain or generate 621.23% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Significant
Accuracy	99.8%
Values	Daily Returns

Leverage Shares 2x  vs.  VanEck Crypto Blockchain

Leverage Shares 2x

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Leverage Shares 2x has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of uncertain performance in the last few months, the Etf's basic indicators remain comparatively stable which may send shares a bit higher in January 2025. The newest uproar may also be a sign of mid-term up-swing for the exchange-traded fund private investors.

VanEck Crypto Blockchain

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in VanEck Crypto Blockchain are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, VanEck Crypto unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Leverage Shares and VanEck Crypto

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

The idea behind Leverage Shares 2x and VanEck Crypto Blockchain 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..