Correlation Between VanEck Oil and SSgA SPDR

Can any of the company-specific risk be diversified away by investing in both VanEck Oil 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 Oil 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 Oil Services and SSgA SPDR ETFs, you can compare the effects of market volatilities on VanEck Oil 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 Oil with a short position of SSgA SPDR. Check out your portfolio center. Please also check ongoing floating volatility patterns of VanEck Oil and SSgA SPDR.

Diversification Opportunities for VanEck Oil and SSgA SPDR

0.0

Correlation Coefficient

VanEck Oil  SSgA SPDR

Pay attention - limited upside

The 3 months correlation between VanEck and SSgA is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Oil Services 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 Oil 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 Oil Services 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 Oil i.e., VanEck Oil and SSgA SPDR go up and down completely randomly.

Pair Corralation between VanEck Oil and SSgA SPDR

If you would invest  5,845  in SSgA SPDR ETFs on April 24, 2025 and sell it today you would earn a total of  973.00  from holding SSgA SPDR ETFs or generate 16.65% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

VanEck Oil Services  vs.  SSgA SPDR ETFs

VanEck Oil Services

Risk-Adjusted Performance

OK

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

SSgA SPDR ETFs

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in SSgA SPDR ETFs are ranked lower than 22 (%) 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 Oil and SSgA SPDR

The main advantage of trading using opposite VanEck Oil and SSgA SPDR positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if VanEck Oil 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 Oil Services 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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.