Correlation Between Eaton Vance and Virtus Emerging
Can any of the company-specific risk be diversified away by investing in both Eaton Vance and Virtus Emerging 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 Eaton Vance and Virtus Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eaton Vance Income and Virtus Emerging Markets, you can compare the effects of market volatilities on Eaton Vance and Virtus Emerging 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 Eaton Vance with a short position of Virtus Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eaton Vance and Virtus Emerging.
Diversification Opportunities for Eaton Vance and Virtus Emerging
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Eaton and Virtus is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Eaton Vance Income and Virtus Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virtus Emerging Markets and Eaton Vance 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 Eaton Vance Income are associated (or correlated) with Virtus Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virtus Emerging Markets has no effect on the direction of Eaton Vance i.e., Eaton Vance and Virtus Emerging go up and down completely randomly.
Pair Corralation between Eaton Vance and Virtus Emerging
Assuming the 90 days horizon Eaton Vance Income is expected to generate 0.3 times more return on investment than Virtus Emerging. However, Eaton Vance Income is 3.39 times less risky than Virtus Emerging. It trades about 0.16 of its potential returns per unit of risk. Virtus Emerging Markets is currently generating about -0.01 per unit of risk. If you would invest 463.00 in Eaton Vance Income on August 29, 2024 and sell it today you would earn a total of 60.00 from holding Eaton Vance Income or generate 12.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eaton Vance Income vs. Virtus Emerging Markets
Performance |
| Timeline |
| Eaton Vance Income |
| Virtus Emerging Markets |
Eaton Vance and Virtus Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eaton Vance and Virtus Emerging
The main advantage of trading using opposite Eaton Vance and Virtus Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eaton Vance position performs unexpectedly, Virtus Emerging 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 Emerging will offset losses from the drop in Virtus Emerging's long position.| Eaton Vance vs. Prudential High Yield | Eaton Vance vs. HUMANA INC | Eaton Vance vs. Aquagold International | Eaton Vance vs. Barloworld Ltd ADR |
| Virtus Emerging vs. Metropolitan West Total | Virtus Emerging vs. Janus Flexible Bond | Virtus Emerging vs. Eaton Vance Income | Virtus Emerging vs. Mfs Emerging Markets |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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