Correlation Between Virtus Seix and Catalyst/millburn
Can any of the company-specific risk be diversified away by investing in both Virtus Seix and Catalyst/millburn 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 Seix and Catalyst/millburn into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Virtus Seix Government and Catalystmillburn Hedge Strategy, you can compare the effects of market volatilities on Virtus Seix and Catalyst/millburn 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 Seix with a short position of Catalyst/millburn. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus Seix and Catalyst/millburn.
Diversification Opportunities for Virtus Seix and Catalyst/millburn
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Virtus and Catalyst/millburn is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Virtus Seix Government and Catalystmillburn Hedge Strateg in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalystmillburn Hedge and Virtus Seix 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 Seix Government are associated (or correlated) with Catalyst/millburn. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catalystmillburn Hedge has no effect on the direction of Virtus Seix i.e., Virtus Seix and Catalyst/millburn go up and down completely randomly.
Pair Corralation between Virtus Seix and Catalyst/millburn
Assuming the 90 days horizon Virtus Seix is expected to generate 1.49 times less return on investment than Catalyst/millburn. But when comparing it to its historical volatility, Virtus Seix Government is 7.4 times less risky than Catalyst/millburn. It trades about 0.23 of its potential returns per unit of risk. Catalystmillburn Hedge Strategy is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 3,442 in Catalystmillburn Hedge Strategy on October 21, 2024 and sell it today you would earn a total of 563.00 from holding Catalystmillburn Hedge Strategy or generate 16.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Virtus Seix Government vs. Catalystmillburn Hedge Strateg
Performance |
| Timeline |
| Virtus Seix Government |
| Catalystmillburn Hedge |
Virtus Seix and Catalyst/millburn Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Virtus Seix and Catalyst/millburn
The main advantage of trading using opposite Virtus Seix and Catalyst/millburn positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virtus Seix position performs unexpectedly, Catalyst/millburn 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 Catalyst/millburn will offset losses from the drop in Catalyst/millburn's long position.| Virtus Seix vs. Virtus Global Real | Virtus Seix vs. Allianzgi Mid Cap Fund | Virtus Seix vs. Virtus Select Mlp | Virtus Seix vs. Virtus Rampart Enhanced |
| Catalyst/millburn vs. Virtus Seix Government | Catalyst/millburn vs. Gurtin California Muni | Catalyst/millburn vs. Ab Municipal Bond | Catalyst/millburn vs. Old Westbury Municipal |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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