Correlation Between VanEck Solana and SSgA SPDR

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

By analyzing existing cross correlation between VanEck Solana ETN and SSgA SPDR ETFs, you can compare the effects of market volatilities on VanEck Solana and SSgA SPDR 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 Solana with a short position of SSgA SPDR. Check out your portfolio center. Please also check ongoing floating volatility patterns of VanEck Solana and SSgA SPDR.

Diversification Opportunities for VanEck Solana and SSgA SPDR

0.76

Correlation Coefficient

VanEck Solana  SSgA SPDR

Poor diversification

The 3 months correlation between VanEck and SSgA is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Solana ETN and SSgA SPDR ETFs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SSgA SPDR ETFs and VanEck Solana 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 Solana ETN are associated (or correlated) with SSgA SPDR. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SSgA SPDR ETFs has no effect on the direction of VanEck Solana i.e., VanEck Solana and SSgA SPDR go up and down completely randomly.

Pair Corralation between VanEck Solana and SSgA SPDR

Assuming the 90 days trading horizon VanEck Solana ETN is expected to generate 5.08 times more return on investment than SSgA SPDR. However, VanEck Solana is 5.08 times more volatile than SSgA SPDR ETFs. It trades about 0.09 of its potential returns per unit of risk. SSgA SPDR ETFs is currently generating about 0.21 per unit of risk. If you would invest  834.00  in VanEck Solana ETN on September 26, 2024 and sell it today you would earn a total of  206.00  from holding VanEck Solana ETN or generate 24.7% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	96.92%
Values	Daily Returns

VanEck Solana ETN  vs.  SSgA SPDR ETFs

VanEck Solana ETN

Risk-Adjusted Performance

7 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in VanEck Solana ETN are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, VanEck Solana unveiled solid returns over the last few months and may actually be approaching a breakup point.

SSgA SPDR ETFs

Risk-Adjusted Performance

16 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in SSgA SPDR ETFs are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, SSgA SPDR unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with VanEck Solana and SSgA SPDR

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

The idea behind VanEck Solana ETN and SSgA SPDR ETFs 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.