Correlation Between VanEck Semiconductor and VanEck Robotics

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

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

Diversification Opportunities for VanEck Semiconductor and VanEck Robotics

0.99

Correlation Coefficient

VanEck Semiconductor  VanEck Robotics

No risk reduction

The 3 months correlation between VanEck and VanEck is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding VanEck Semiconductor ETF and VanEck Robotics ETF in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VanEck Robotics ETF and VanEck Semiconductor 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 Semiconductor ETF are associated (or correlated) with VanEck Robotics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VanEck Robotics ETF has no effect on the direction of VanEck Semiconductor i.e., VanEck Semiconductor and VanEck Robotics go up and down completely randomly.

Pair Corralation between VanEck Semiconductor and VanEck Robotics

Considering the 90-day investment horizon VanEck Semiconductor ETF is expected to generate 1.42 times more return on investment than VanEck Robotics. However, VanEck Semiconductor is 1.42 times more volatile than VanEck Robotics ETF. It trades about 0.29 of its potential returns per unit of risk. VanEck Robotics ETF is currently generating about 0.21 per unit of risk. If you would invest  21,761  in VanEck Semiconductor ETF on May 5, 2025 and sell it today you would earn a total of  6,634  from holding VanEck Semiconductor ETF or generate 30.49% return on investment over 90 days.

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

VanEck Semiconductor ETF  vs.  VanEck Robotics ETF

VanEck Semiconductor ETF

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in VanEck Semiconductor ETF are ranked lower than 22 (%) of all global equities and portfolios over the last 90 days. Despite fairly weak primary indicators, VanEck Semiconductor demonstrated solid returns over the last few months and may actually be approaching a breakup point.

VanEck Robotics ETF

Risk-Adjusted Performance

Solid

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

Pair Trading with VanEck Semiconductor and VanEck Robotics

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

The idea behind VanEck Semiconductor ETF and VanEck Robotics ETF 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.