Correlation Between Virtus ETF and Schwab Fundamental
Can any of the company-specific risk be diversified away by investing in both Virtus ETF and Schwab Fundamental 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 Schwab Fundamental 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 Schwab Fundamental Large, you can compare the effects of market volatilities on Virtus ETF and Schwab Fundamental 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 Schwab Fundamental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus ETF and Schwab Fundamental.
Diversification Opportunities for Virtus ETF and Schwab Fundamental
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Virtus and Schwab is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Virtus ETF Trust and Schwab Fundamental Large in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Schwab Fundamental Large 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 Schwab Fundamental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Schwab Fundamental Large has no effect on the direction of Virtus ETF i.e., Virtus ETF and Schwab Fundamental go up and down completely randomly.
Pair Corralation between Virtus ETF and Schwab Fundamental
Given the investment horizon of 90 days Virtus ETF Trust is expected to generate 1.25 times more return on investment than Schwab Fundamental. However, Virtus ETF is 1.25 times more volatile than Schwab Fundamental Large. It trades about 0.12 of its potential returns per unit of risk. Schwab Fundamental Large is currently generating about 0.13 per unit of risk. If you would invest 2,824 in Virtus ETF Trust on August 28, 2024 and sell it today you would earn a total of 1,247 from holding Virtus ETF Trust or generate 44.16% 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. Schwab Fundamental Large
Performance |
| Timeline |
| Virtus ETF Trust |
| Schwab Fundamental Large |
Virtus ETF and Schwab Fundamental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Virtus ETF and Schwab Fundamental
The main advantage of trading using opposite Virtus ETF and Schwab Fundamental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virtus ETF position performs unexpectedly, Schwab Fundamental 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 Schwab Fundamental will offset losses from the drop in Schwab Fundamental'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 |
| Schwab Fundamental vs. BlackRock ETF Trust | Schwab Fundamental vs. Rbb Fund | Schwab Fundamental vs. Virtus ETF Trust | Schwab Fundamental 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| ETF Categories List of ETF categories grouped based on various criteria, such as the investment strategy or type of investments | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |