Correlation Between Virtus ETF and IShares Core
Can any of the company-specific risk be diversified away by investing in both Virtus ETF and IShares Core 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 Virtus ETF and IShares Core into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Virtus ETF Trust and iShares Core Dividend, you can compare the effects of market volatilities on Virtus ETF and IShares Core 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 Virtus ETF with a short position of IShares Core. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus ETF and IShares Core.
Diversification Opportunities for Virtus ETF and IShares Core
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Virtus and IShares is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Virtus ETF Trust and iShares Core Dividend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iShares Core Dividend and Virtus ETF 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 Virtus ETF Trust are associated (or correlated) with IShares Core. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iShares Core Dividend has no effect on the direction of Virtus ETF i.e., Virtus ETF and IShares Core go up and down completely randomly.
Pair Corralation between Virtus ETF and IShares Core
Given the investment horizon of 90 days Virtus ETF Trust is expected to generate 1.46 times more return on investment than IShares Core. However, Virtus ETF is 1.46 times more volatile than iShares Core Dividend. It trades about 0.24 of its potential returns per unit of risk. iShares Core Dividend is currently generating about 0.14 per unit of risk. If you would invest 3,559 in Virtus ETF Trust on August 29, 2024 and sell it today you would earn a total of 515.00 from holding Virtus ETF Trust or generate 14.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Virtus ETF Trust vs. iShares Core Dividend
Performance |
| Timeline |
| Virtus ETF Trust |
| iShares Core Dividend |
Virtus ETF and IShares Core Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Virtus ETF and IShares Core
The main advantage of trading using opposite Virtus ETF and IShares Core positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virtus ETF position performs unexpectedly, IShares Core 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 IShares Core will offset losses from the drop in IShares Core's long position.| Virtus ETF vs. iShares Small Cap | Virtus ETF vs. Pacer Cash Cows | Virtus ETF vs. GXO Logistics | Virtus ETF vs. ProShares Pet Care |
| IShares Core vs. iShares Core High | IShares Core vs. Schwab Dividend Equity | IShares Core vs. ProShares SP 500 | IShares Core vs. Invesco SP 500 |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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