Correlation Between US Global and Virtus Investment
Can any of the company-specific risk be diversified away by investing in both US Global and Virtus Investment 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 US Global and Virtus Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between US Global Investors and Virtus Investment Partners,, you can compare the effects of market volatilities on US Global and Virtus Investment 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 US Global with a short position of Virtus Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of US Global and Virtus Investment.
Diversification Opportunities for US Global and Virtus Investment
-0.55 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between GROW and Virtus is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding US Global Investors and Virtus Investment Partners, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virtus Investment and US Global 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 US Global Investors are associated (or correlated) with Virtus Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virtus Investment has no effect on the direction of US Global i.e., US Global and Virtus Investment go up and down completely randomly.
Pair Corralation between US Global and Virtus Investment
Given the investment horizon of 90 days US Global is expected to generate 13.5 times less return on investment than Virtus Investment. But when comparing it to its historical volatility, US Global Investors is 1.81 times less risky than Virtus Investment. It trades about 0.03 of its potential returns per unit of risk. Virtus Investment Partners, is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 21,161 in Virtus Investment Partners, on August 26, 2024 and sell it today you would earn a total of 3,048 from holding Virtus Investment Partners, or generate 14.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
US Global Investors vs. Virtus Investment Partners,
Performance |
| Timeline |
| US Global Investors |
| Virtus Investment |
US Global and Virtus Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with US Global and Virtus Investment
The main advantage of trading using opposite US Global and Virtus Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if US Global position performs unexpectedly, Virtus Investment 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 Investment will offset losses from the drop in Virtus Investment's long position.| US Global vs. Gladstone Investment | US Global vs. PennantPark Floating Rate | US Global vs. Horizon Technology Finance | US Global vs. Stellus Capital Investment |
| Virtus Investment vs. PowerUp Acquisition Corp | Virtus Investment vs. Aurora Innovation | Virtus Investment vs. HUMANA INC | Virtus Investment vs. Aquagold International |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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