Correlation Between VanEck Polkadot and Cardano Impact

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

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

Diversification Opportunities for VanEck Polkadot and Cardano Impact

0.12

Correlation Coefficient

VanEck Polkadot  Cardano Impact

Average diversification

The 3 months correlation between VanEck and Cardano is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Polkadot ETN and Cardano Impact Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cardano Impact Equity and VanEck Polkadot 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 Polkadot ETN are associated (or correlated) with Cardano Impact. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cardano Impact Equity has no effect on the direction of VanEck Polkadot i.e., VanEck Polkadot and Cardano Impact go up and down completely randomly.

Pair Corralation between VanEck Polkadot and Cardano Impact

Assuming the 90 days trading horizon VanEck Polkadot ETN is expected to generate 5.42 times more return on investment than Cardano Impact. However, VanEck Polkadot is 5.42 times more volatile than Cardano Impact Equity. It trades about 0.09 of its potential returns per unit of risk. Cardano Impact Equity is currently generating about 0.2 per unit of risk. 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	98.41%
Values	Daily Returns

VanEck Polkadot ETN  vs.  Cardano Impact Equity

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.

Cardano Impact Equity

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Cardano Impact Equity are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. In spite of comparatively uncertain basic indicators, Cardano Impact unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with VanEck Polkadot and Cardano Impact

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

The idea behind VanEck Polkadot ETN and Cardano Impact Equity 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.