Correlation Between Virtus Bond and Cref Money
Can any of the company-specific risk be diversified away by investing in both Virtus Bond and Cref Money 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 Bond and Cref Money into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Virtus Bond Fund and Cref Money Market, you can compare the effects of market volatilities on Virtus Bond and Cref Money 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 Bond with a short position of Cref Money. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus Bond and Cref Money.
Diversification Opportunities for Virtus Bond and Cref Money
-0.74 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Virtus and Cref is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Virtus Bond Fund and Cref Money Market in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cref Money Market and Virtus Bond 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 Bond Fund are associated (or correlated) with Cref Money. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cref Money Market has no effect on the direction of Virtus Bond i.e., Virtus Bond and Cref Money go up and down completely randomly.
Pair Corralation between Virtus Bond and Cref Money
Assuming the 90 days horizon Virtus Bond is expected to generate 1.1 times less return on investment than Cref Money. In addition to that, Virtus Bond is 14.04 times more volatile than Cref Money Market. It trades about 0.05 of its total potential returns per unit of risk. Cref Money Market is currently generating about 0.8 per unit of volatility. If you would invest 2,705 in Cref Money Market on August 28, 2024 and sell it today you would earn a total of 265.00 from holding Cref Money Market or generate 9.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 97.26% |
| Values | Daily Returns |
Virtus Bond Fund vs. Cref Money Market
Performance |
| Timeline |
| Virtus Bond Fund |
| Cref Money Market |
Virtus Bond and Cref Money Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Virtus Bond and Cref Money
The main advantage of trading using opposite Virtus Bond and Cref Money positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virtus Bond position performs unexpectedly, Cref Money 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 Cref Money will offset losses from the drop in Cref Money's long position.| Virtus Bond vs. Virtus Multi Strategy Target | Virtus Bond vs. Virtus Multi Sector Short | Virtus Bond vs. Ridgeworth Seix High | Virtus Bond vs. Ridgeworth Innovative Growth |
| Cref Money vs. Vanguard Global Credit | Cref Money vs. Ms Global Fixed | Cref Money vs. T Rowe Price | Cref Money vs. Chartwell Short Duration |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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