Correlation Between Virtus Convertible and Westcore Small-cap
Can any of the company-specific risk be diversified away by investing in both Virtus Convertible and Westcore Small-cap 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 Convertible and Westcore Small-cap into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Virtus Convertible and Westcore Small Cap Growth, you can compare the effects of market volatilities on Virtus Convertible and Westcore Small-cap 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 Convertible with a short position of Westcore Small-cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus Convertible and Westcore Small-cap.
Diversification Opportunities for Virtus Convertible and Westcore Small-cap
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Virtus and Westcore is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Virtus Convertible and Westcore Small Cap Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westcore Small Cap and Virtus Convertible 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 Convertible are associated (or correlated) with Westcore Small-cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Westcore Small Cap has no effect on the direction of Virtus Convertible i.e., Virtus Convertible and Westcore Small-cap go up and down completely randomly.
Pair Corralation between Virtus Convertible and Westcore Small-cap
Assuming the 90 days horizon Virtus Convertible is expected to generate 0.66 times more return on investment than Westcore Small-cap. However, Virtus Convertible is 1.52 times less risky than Westcore Small-cap. It trades about 0.24 of its potential returns per unit of risk. Westcore Small Cap Growth is currently generating about 0.13 per unit of risk. If you would invest 3,529 in Virtus Convertible on November 3, 2024 and sell it today you would earn a total of 126.00 from holding Virtus Convertible or generate 3.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Virtus Convertible vs. Westcore Small Cap Growth
Performance |
| Timeline |
| Virtus Convertible |
| Westcore Small Cap |
Virtus Convertible and Westcore Small-cap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Virtus Convertible and Westcore Small-cap
The main advantage of trading using opposite Virtus Convertible and Westcore Small-cap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virtus Convertible position performs unexpectedly, Westcore Small-cap 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 Westcore Small-cap will offset losses from the drop in Westcore Small-cap's long position.| Virtus Convertible vs. Strategic Advisers Income | Virtus Convertible vs. Msift High Yield | Virtus Convertible vs. Artisan High Income | Virtus Convertible vs. Lord Abbett Short |
| Westcore Small-cap vs. Morningstar Defensive Bond | Westcore Small-cap vs. Angel Oak Financial | Westcore Small-cap vs. Siit High Yield | Westcore Small-cap vs. Ab Bond Inflation |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm |