Correlation Between Victory Capital and General American
Can any of the company-specific risk be diversified away by investing in both Victory Capital and General American 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 Victory Capital and General American into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Victory Capital Holdings and General American Investors, you can compare the effects of market volatilities on Victory Capital and General American 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 Victory Capital with a short position of General American. Check out your portfolio center. Please also check ongoing floating volatility patterns of Victory Capital and General American.
Diversification Opportunities for Victory Capital and General American
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Victory and General is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding Victory Capital Holdings and General American Investors in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on General American Inv and Victory Capital 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 Victory Capital Holdings are associated (or correlated) with General American. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of General American Inv has no effect on the direction of Victory Capital i.e., Victory Capital and General American go up and down completely randomly.
Pair Corralation between Victory Capital and General American
Given the investment horizon of 90 days Victory Capital Holdings is expected to generate 6.08 times more return on investment than General American. However, Victory Capital is 6.08 times more volatile than General American Investors. It trades about -0.05 of its potential returns per unit of risk. General American Investors is currently generating about -0.34 per unit of risk. If you would invest 6,572 in Victory Capital Holdings on December 1, 2024 and sell it today you would lose (168.00) from holding Victory Capital Holdings or give up 2.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Victory Capital Holdings vs. General American Investors
Performance |
| Timeline |
| Victory Capital Holdings |
| General American Inv |
Victory Capital and General American Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Victory Capital and General American
The main advantage of trading using opposite Victory Capital and General American positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Victory Capital position performs unexpectedly, General American 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 General American will offset losses from the drop in General American's long position.| Victory Capital vs. Federated Premier Municipal | Victory Capital vs. Blackrock Muniyield | Victory Capital vs. Diamond Hill Investment | Victory Capital vs. NXG NextGen Infrastructure |
| General American vs. Blackrock Muniyield | General American vs. Allianzgi Equity Convertible | General American vs. MFS Investment Grade | General American vs. Eaton Vance National |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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