Correlation Between Victory Capital and B Riley
Can any of the company-specific risk be diversified away by investing in both Victory Capital and B Riley 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 B Riley 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 B Riley Financial, you can compare the effects of market volatilities on Victory Capital and B Riley 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 B Riley. Check out your portfolio center. Please also check ongoing floating volatility patterns of Victory Capital and B Riley.
Diversification Opportunities for Victory Capital and B Riley
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Victory and RILYK is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Victory Capital Holdings and B Riley Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on B Riley Financial 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 B Riley. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of B Riley Financial has no effect on the direction of Victory Capital i.e., Victory Capital and B Riley go up and down completely randomly.
Pair Corralation between Victory Capital and B Riley
Given the investment horizon of 90 days Victory Capital Holdings is expected to generate 2.04 times more return on investment than B Riley. However, Victory Capital is 2.04 times more volatile than B Riley Financial. It trades about 0.23 of its potential returns per unit of risk. B Riley Financial is currently generating about 0.3 per unit of risk. If you would invest 5,993 in Victory Capital Holdings on September 1, 2024 and sell it today you would earn a total of 955.00 from holding Victory Capital Holdings or generate 15.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Victory Capital Holdings vs. B Riley Financial
Performance |
| Timeline |
| Victory Capital Holdings |
| B Riley Financial |
Victory Capital and B Riley Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Victory Capital and B Riley
The main advantage of trading using opposite Victory Capital and B Riley positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Victory Capital position performs unexpectedly, B Riley 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 B Riley will offset losses from the drop in B Riley's long position.| Victory Capital vs. Visa Class A | Victory Capital vs. Diamond Hill Investment | Victory Capital vs. Distoken Acquisition | Victory Capital vs. Associated Capital Group |
| B Riley vs. B Riley Financial | B Riley vs. B Riley Financial, | B Riley vs. B Riley Financial | B Riley vs. B Riley Financial |
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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