Correlation Between Baytex Energy and VanEck Digital

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

By analyzing existing cross correlation between Baytex Energy Corp and VanEck Digital Transformation, you can compare the effects of market volatilities on Baytex Energy and VanEck Digital 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 Baytex Energy with a short position of VanEck Digital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baytex Energy and VanEck Digital.

Diversification Opportunities for Baytex Energy and VanEck Digital

0.59

Correlation Coefficient

Baytex Energy  VanEck Digital

Very weak diversification

The 3 months correlation between Baytex and VanEck is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Baytex Energy Corp and VanEck Digital Transformation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VanEck Digital Trans and Baytex Energy 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 Baytex Energy Corp are associated (or correlated) with VanEck Digital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VanEck Digital Trans has no effect on the direction of Baytex Energy i.e., Baytex Energy and VanEck Digital go up and down completely randomly.

Pair Corralation between Baytex Energy and VanEck Digital

Considering the 90-day investment horizon Baytex Energy is expected to generate 1.19 times less return on investment than VanEck Digital. In addition to that, Baytex Energy is 1.01 times more volatile than VanEck Digital Transformation. It trades about 0.16 of its total potential returns per unit of risk. VanEck Digital Transformation is currently generating about 0.2 per unit of volatility. If you would invest  1,083  in VanEck Digital Transformation on May 6, 2025 and sell it today you would earn a total of  550.00  from holding VanEck Digital Transformation or generate 50.78% return on investment over 90 days.

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

Baytex Energy Corp  vs.  VanEck Digital Transformation

Baytex Energy Corp

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Baytex Energy Corp are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, Baytex Energy exhibited solid returns over the last few months and may actually be approaching a breakup point.

VanEck Digital Trans

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in VanEck Digital Transformation are ranked lower than 15 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak basic indicators, VanEck Digital reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Baytex Energy and VanEck Digital

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

The idea behind Baytex Energy Corp and VanEck Digital Transformation 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 Commodity Directory module to find actively traded commodities issued by global exchanges.