Correlation Between Virtus ETF and Invesco SP
Can any of the company-specific risk be diversified away by investing in both Virtus ETF and Invesco SP 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 Invesco SP 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 Invesco SP 100, you can compare the effects of market volatilities on Virtus ETF and Invesco SP 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 Invesco SP. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus ETF and Invesco SP.
Diversification Opportunities for Virtus ETF and Invesco SP
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Virtus and Invesco is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Virtus ETF Trust and Invesco SP 100 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco SP 100 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 Invesco SP. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco SP 100 has no effect on the direction of Virtus ETF i.e., Virtus ETF and Invesco SP go up and down completely randomly.
Pair Corralation between Virtus ETF and Invesco SP
Given the investment horizon of 90 days Virtus ETF Trust is expected to generate 1.36 times more return on investment than Invesco SP. However, Virtus ETF is 1.36 times more volatile than Invesco SP 100. It trades about 0.22 of its potential returns per unit of risk. Invesco SP 100 is currently generating about 0.16 per unit of risk. If you would invest 3,549 in Virtus ETF Trust on August 26, 2024 and sell it today you would earn a total of 491.00 from holding Virtus ETF Trust or generate 13.83% 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. Invesco SP 100
Performance |
| Timeline |
| Virtus ETF Trust |
| Invesco SP 100 |
Virtus ETF and Invesco SP Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Virtus ETF and Invesco SP
The main advantage of trading using opposite Virtus ETF and Invesco SP positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virtus ETF position performs unexpectedly, Invesco SP 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 Invesco SP will offset losses from the drop in Invesco SP'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 |
| Invesco SP vs. BlackRock ETF Trust | Invesco SP vs. Rbb Fund | Invesco SP vs. Virtus ETF Trust | Invesco SP vs. Amplify CWP Enhanced |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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