Correlation Between Saat Market and Virtus Multi-strategy
Can any of the company-specific risk be diversified away by investing in both Saat Market and Virtus Multi-strategy 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 Saat Market and Virtus Multi-strategy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Saat Market Growth and Virtus Multi Strategy Target, you can compare the effects of market volatilities on Saat Market and Virtus Multi-strategy 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 Saat Market with a short position of Virtus Multi-strategy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Saat Market and Virtus Multi-strategy.
Diversification Opportunities for Saat Market and Virtus Multi-strategy
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Saat and Virtus is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Saat Market Growth and Virtus Multi Strategy Target in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virtus Multi Strategy and Saat Market 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 Saat Market Growth are associated (or correlated) with Virtus Multi-strategy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virtus Multi Strategy has no effect on the direction of Saat Market i.e., Saat Market and Virtus Multi-strategy go up and down completely randomly.
Pair Corralation between Saat Market and Virtus Multi-strategy
Assuming the 90 days horizon Saat Market Growth is expected to generate 2.23 times more return on investment than Virtus Multi-strategy. However, Saat Market is 2.23 times more volatile than Virtus Multi Strategy Target. It trades about 0.22 of its potential returns per unit of risk. Virtus Multi Strategy Target is currently generating about 0.24 per unit of risk. If you would invest 1,236 in Saat Market Growth on November 7, 2024 and sell it today you would earn a total of 27.00 from holding Saat Market Growth or generate 2.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 90.0% |
| Values | Daily Returns |
Saat Market Growth vs. Virtus Multi Strategy Target
Performance |
| Timeline |
| Saat Market Growth |
| Virtus Multi Strategy |
Saat Market and Virtus Multi-strategy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Saat Market and Virtus Multi-strategy
The main advantage of trading using opposite Saat Market and Virtus Multi-strategy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Saat Market position performs unexpectedly, Virtus Multi-strategy 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 Multi-strategy will offset losses from the drop in Virtus Multi-strategy's long position.| Saat Market vs. Simt Mid Cap | Saat Market vs. Saat Tax Managed Aggressive | Saat Market vs. Sit Emerging Markets | Saat Market vs. Simt High Yield |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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