Correlation Between Dynex Capital and Virtus Real
Can any of the company-specific risk be diversified away by investing in both Dynex Capital and Virtus Real 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 Dynex Capital and Virtus Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dynex Capital and Virtus Real Estate, you can compare the effects of market volatilities on Dynex Capital and Virtus Real 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 Dynex Capital with a short position of Virtus Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dynex Capital and Virtus Real.
Diversification Opportunities for Dynex Capital and Virtus Real
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dynex and Virtus is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Dynex Capital and Virtus Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virtus Real Estate and Dynex Capital 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 Dynex Capital are associated (or correlated) with Virtus Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virtus Real Estate has no effect on the direction of Dynex Capital i.e., Dynex Capital and Virtus Real go up and down completely randomly.
Pair Corralation between Dynex Capital and Virtus Real
Allowing for the 90-day total investment horizon Dynex Capital is expected to generate 1.01 times less return on investment than Virtus Real. In addition to that, Dynex Capital is 1.38 times more volatile than Virtus Real Estate. It trades about 0.05 of its total potential returns per unit of risk. Virtus Real Estate is currently generating about 0.06 per unit of volatility. If you would invest 1,737 in Virtus Real Estate on August 28, 2024 and sell it today you would earn a total of 431.00 from holding Virtus Real Estate or generate 24.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dynex Capital vs. Virtus Real Estate
Performance |
| Timeline |
| Dynex Capital |
| Virtus Real Estate |
Dynex Capital and Virtus Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dynex Capital and Virtus Real
The main advantage of trading using opposite Dynex Capital and Virtus Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dynex Capital position performs unexpectedly, Virtus Real 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 Real will offset losses from the drop in Virtus Real's long position.| Dynex Capital vs. Blackstone Mortgage Trust | Dynex Capital vs. Omega Healthcare Investors | Dynex Capital vs. Medical Properties Trust |
| Virtus Real vs. Realty Income | Virtus Real vs. Dynex Capital | Virtus Real vs. First Industrial Realty | Virtus Real vs. Healthcare Realty Trust |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Instant Ratings Determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |