Correlation Between Capitol Series and VanEck Vectors

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

By analyzing existing cross correlation between Capitol Series Trust and VanEck Vectors Moodys, you can compare the effects of market volatilities on Capitol Series and VanEck Vectors 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 Capitol Series with a short position of VanEck Vectors. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capitol Series and VanEck Vectors.

Diversification Opportunities for Capitol Series and VanEck Vectors

-0.35

Correlation Coefficient

Capitol Series  VanEck Vectors

Very good diversification

The 3 months correlation between Capitol and VanEck is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Capitol Series Trust and VanEck Vectors Moodys in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VanEck Vectors Moodys and Capitol Series 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 Capitol Series Trust are associated (or correlated) with VanEck Vectors. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VanEck Vectors Moodys has no effect on the direction of Capitol Series i.e., Capitol Series and VanEck Vectors go up and down completely randomly.

Pair Corralation between Capitol Series and VanEck Vectors

Considering the 90-day investment horizon Capitol Series Trust is expected to generate 2.73 times more return on investment than VanEck Vectors. However, Capitol Series is 2.73 times more volatile than VanEck Vectors Moodys. It trades about 0.21 of its potential returns per unit of risk. VanEck Vectors Moodys is currently generating about 0.12 per unit of risk. If you would invest  2,945  in Capitol Series Trust on September 16, 2024 and sell it today you would earn a total of  110.00  from holding Capitol Series Trust or generate 3.74% return on investment over 90 days.

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

Capitol Series Trust  vs.  VanEck Vectors Moodys

Capitol Series Trust

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Capitol Series Trust are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, Capitol Series exhibited solid returns over the last few months and may actually be approaching a breakup point.

VanEck Vectors Moodys

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days VanEck Vectors Moodys has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong fundamental drivers, VanEck Vectors is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Capitol Series and VanEck Vectors

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

The idea behind Capitol Series Trust and VanEck Vectors Moodys 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..