Correlation Between Total Return and Virtus Bond
Can any of the company-specific risk be diversified away by investing in both Total Return and Virtus Bond 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 Total Return and Virtus Bond into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Total Return Fund and Virtus Bond Fund, you can compare the effects of market volatilities on Total Return and Virtus Bond 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 Total Return with a short position of Virtus Bond. Check out your portfolio center. Please also check ongoing floating volatility patterns of Total Return and Virtus Bond.
Diversification Opportunities for Total Return and Virtus Bond
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Total and Virtus is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Total Return Fund and Virtus Bond Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virtus Bond Fund and Total Return 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 Total Return Fund are associated (or correlated) with Virtus Bond. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virtus Bond Fund has no effect on the direction of Total Return i.e., Total Return and Virtus Bond go up and down completely randomly.
Pair Corralation between Total Return and Virtus Bond
Assuming the 90 days horizon Total Return is expected to generate 1.11 times less return on investment than Virtus Bond. In addition to that, Total Return is 1.09 times more volatile than Virtus Bond Fund. It trades about 0.09 of its total potential returns per unit of risk. Virtus Bond Fund is currently generating about 0.11 per unit of volatility. If you would invest 982.00 in Virtus Bond Fund on September 3, 2024 and sell it today you would earn a total of 49.00 from holding Virtus Bond Fund or generate 4.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Total Return Fund vs. Virtus Bond Fund
Performance |
| Timeline |
| Total Return |
| Virtus Bond Fund |
Total Return and Virtus Bond Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Total Return and Virtus Bond
The main advantage of trading using opposite Total Return and Virtus Bond positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Total Return position performs unexpectedly, Virtus Bond 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 Bond will offset losses from the drop in Virtus Bond's long position.| Total Return vs. Metropolitan West Total | Total Return vs. Metropolitan West Total | Total Return vs. Pimco Total Return | Total Return vs. Total Return Fund |
| Virtus Bond vs. Metropolitan West Total | Virtus Bond vs. Metropolitan West Total | Virtus Bond vs. Pimco Total Return | Virtus Bond vs. Total Return Fund |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
Other Complementary Tools
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Portfolio Manager State of the art Portfolio Manager to monitor and improve performance of your invested capital |