Correlation Between IShares Core and VanEck Polkadot

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

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

Diversification Opportunities for IShares Core and VanEck Polkadot

0.1

Correlation Coefficient

IShares Core  VanEck Polkadot

Average diversification

The 3 months correlation between IShares and VanEck is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding iShares Core SP and VanEck Polkadot ETN in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VanEck Polkadot ETN and IShares Core 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 iShares Core SP are associated (or correlated) with VanEck Polkadot. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VanEck Polkadot ETN has no effect on the direction of IShares Core i.e., IShares Core and VanEck Polkadot go up and down completely randomly.

Pair Corralation between IShares Core and VanEck Polkadot

Assuming the 90 days trading horizon IShares Core is expected to generate 2.66 times less return on investment than VanEck Polkadot. But when comparing it to its historical volatility, iShares Core SP is 6.55 times less risky than VanEck Polkadot. It trades about 0.23 of its potential returns per unit of risk. VanEck Polkadot ETN is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest  111.00  in VanEck Polkadot ETN on April 23, 2025 and sell it today you would earn a total of  32.00  from holding VanEck Polkadot ETN or generate 28.83% return on investment over 90 days.

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

iShares Core SP  vs.  VanEck Polkadot ETN

iShares Core SP

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in iShares Core SP are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively weak basic indicators, IShares Core unveiled solid returns over the last few months and may actually be approaching a breakup point.

VanEck Polkadot ETN

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in VanEck Polkadot 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 Polkadot unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with IShares Core and VanEck Polkadot

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

The idea behind iShares Core SP and VanEck Polkadot ETN 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 Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.