Correlation Between High Yield and Virtus High
Can any of the company-specific risk be diversified away by investing in both High Yield and Virtus High 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 High Yield and Virtus High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between High Yield Portfolio and Virtus High Yield, you can compare the effects of market volatilities on High Yield and Virtus High 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 High Yield with a short position of Virtus High. Check out your portfolio center. Please also check ongoing floating volatility patterns of High Yield and Virtus High.
Diversification Opportunities for High Yield and Virtus High
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between High and Virtus is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding High Yield Portfolio and Virtus High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virtus High Yield and High Yield 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 High Yield Portfolio are associated (or correlated) with Virtus High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virtus High Yield has no effect on the direction of High Yield i.e., High Yield and Virtus High go up and down completely randomly.
Pair Corralation between High Yield and Virtus High
Assuming the 90 days horizon High Yield is expected to generate 1.33 times less return on investment than Virtus High. But when comparing it to its historical volatility, High Yield Portfolio is 1.64 times less risky than Virtus High. It trades about 0.21 of its potential returns per unit of risk. Virtus High Yield is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 357.00 in Virtus High Yield on October 25, 2024 and sell it today you would earn a total of 32.00 from holding Virtus High Yield or generate 8.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
High Yield Portfolio vs. Virtus High Yield
Performance |
| Timeline |
| High Yield Portfolio |
| Virtus High Yield |
High Yield and Virtus High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with High Yield and Virtus High
The main advantage of trading using opposite High Yield and Virtus High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if High Yield position performs unexpectedly, Virtus High 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 High will offset losses from the drop in Virtus High's long position.| High Yield vs. Morgan Stanley Emerging | High Yield vs. Growth Strategy Fund | High Yield vs. Transamerica Emerging Markets | High Yield vs. Dws Emerging Markets |
| Virtus High vs. Guidemark Large Cap | Virtus High vs. Calvert Moderate Allocation | Virtus High vs. T Rowe Price | Virtus High vs. Franklin Moderate Allocation |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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