Correlation Between Eaton Vance and Virtus Convertible
Can any of the company-specific risk be diversified away by investing in both Eaton Vance and Virtus Convertible 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 Convertible into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Eaton Vance Worldwide and Virtus Convertible, you can compare the effects of market volatilities on Eaton Vance and Virtus Convertible 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 Convertible. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eaton Vance and Virtus Convertible.
Diversification Opportunities for Eaton Vance and Virtus Convertible
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Eaton and Virtus is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding Eaton Vance Worldwide and Virtus Convertible in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virtus Convertible 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 Worldwide are associated (or correlated) with Virtus Convertible. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virtus Convertible has no effect on the direction of Eaton Vance i.e., Eaton Vance and Virtus Convertible go up and down completely randomly.
Pair Corralation between Eaton Vance and Virtus Convertible
Assuming the 90 days horizon Eaton Vance is expected to generate 1.55 times less return on investment than Virtus Convertible. In addition to that, Eaton Vance is 1.21 times more volatile than Virtus Convertible. It trades about 0.08 of its total potential returns per unit of risk. Virtus Convertible is currently generating about 0.15 per unit of volatility. If you would invest 3,004 in Virtus Convertible on September 4, 2024 and sell it today you would earn a total of 718.00 from holding Virtus Convertible or generate 23.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eaton Vance Worldwide vs. Virtus Convertible
Performance |
| Timeline |
| Eaton Vance Worldwide |
| Virtus Convertible |
Eaton Vance and Virtus Convertible Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eaton Vance and Virtus Convertible
The main advantage of trading using opposite Eaton Vance and Virtus Convertible positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eaton Vance position performs unexpectedly, Virtus Convertible 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 Convertible will offset losses from the drop in Virtus Convertible's long position.| Eaton Vance vs. Virtus Convertible | Eaton Vance vs. Rationalpier 88 Convertible | Eaton Vance vs. Allianzgi Convertible Income | Eaton Vance vs. Calamos Dynamic Convertible |
| Virtus Convertible vs. Gmo High Yield | Virtus Convertible vs. Pace High Yield | Virtus Convertible vs. Calvert High Yield | Virtus Convertible vs. Pgim High Yield |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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