Correlation Between Hennessy and Virtus Select
Can any of the company-specific risk be diversified away by investing in both Hennessy and Virtus Select 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 Hennessy and Virtus Select into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hennessy Bp Energy and Virtus Select Mlp, you can compare the effects of market volatilities on Hennessy and Virtus Select 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 Hennessy with a short position of Virtus Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hennessy and Virtus Select.
Diversification Opportunities for Hennessy and Virtus Select
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Hennessy and Virtus is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Hennessy Bp Energy and Virtus Select Mlp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virtus Select Mlp and Hennessy 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 Hennessy Bp Energy are associated (or correlated) with Virtus Select. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virtus Select Mlp has no effect on the direction of Hennessy i.e., Hennessy and Virtus Select go up and down completely randomly.
Pair Corralation between Hennessy and Virtus Select
Assuming the 90 days horizon Hennessy Bp Energy is expected to generate 0.69 times more return on investment than Virtus Select. However, Hennessy Bp Energy is 1.45 times less risky than Virtus Select. It trades about 0.05 of its potential returns per unit of risk. Virtus Select Mlp is currently generating about 0.03 per unit of risk. If you would invest 2,735 in Hennessy Bp Energy on November 4, 2024 and sell it today you would earn a total of 27.00 from holding Hennessy Bp Energy or generate 0.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hennessy Bp Energy vs. Virtus Select Mlp
Performance |
| Timeline |
| Hennessy Bp Energy |
| Virtus Select Mlp |
Hennessy and Virtus Select Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hennessy and Virtus Select
The main advantage of trading using opposite Hennessy and Virtus Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hennessy position performs unexpectedly, Virtus Select 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 Select will offset losses from the drop in Virtus Select's long position.| Hennessy vs. World Energy Fund | Hennessy vs. Ivy Energy Fund | Hennessy vs. Blackrock All Cap Energy | Hennessy vs. Energy Fund Class |
| Virtus Select vs. Virtus Convertible | Virtus Select vs. Putnam Convertible Securities | Virtus Select vs. Fidelity Sai Convertible | Virtus Select vs. Absolute Convertible Arbitrage |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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