Correlation Between American Express and Virtus Global
Can any of the company-specific risk be diversified away by investing in both American Express and Virtus Global 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 American Express and Virtus Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between American Express and Virtus Global Opportunities, you can compare the effects of market volatilities on American Express and Virtus Global 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 American Express with a short position of Virtus Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of American Express and Virtus Global.
Diversification Opportunities for American Express and Virtus Global
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between American and Virtus is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding American Express and Virtus Global Opportunities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virtus Global Opport and American Express 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 American Express are associated (or correlated) with Virtus Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virtus Global Opport has no effect on the direction of American Express i.e., American Express and Virtus Global go up and down completely randomly.
Pair Corralation between American Express and Virtus Global
If you would invest 27,269 in American Express on September 2, 2024 and sell it today you would earn a total of 3,199 from holding American Express or generate 11.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 4.76% |
| Values | Daily Returns |
American Express vs. Virtus Global Opportunities
Performance |
| Timeline |
| American Express |
| Virtus Global Opport |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
American Express and Virtus Global Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with American Express and Virtus Global
The main advantage of trading using opposite American Express and Virtus Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if American Express position performs unexpectedly, Virtus Global 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 Virtus Global will offset losses from the drop in Virtus Global's long position.| American Express vs. 360 Finance | American Express vs. Atlanticus Holdings | American Express vs. Qudian Inc | American Express vs. Enova International |
| Virtus Global vs. Virtus Kar Capital | Virtus Global vs. Virtus Rampart Enhanced | Virtus Global vs. Virtus Kar Mid Cap | Virtus Global vs. Virtus Tactical Allocation |
Check out your portfolio center.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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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