Correlation Between Virtus Global and Salient Select
Can any of the company-specific risk be diversified away by investing in both Virtus Global and Salient Select 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 Global and Salient Select into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Virtus Global Real and Salient Select Income, you can compare the effects of market volatilities on Virtus Global and Salient Select 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 Global with a short position of Salient Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus Global and Salient Select.
Diversification Opportunities for Virtus Global and Salient Select
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Virtus and Salient is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Virtus Global Real and Salient Select Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Salient Select Income and Virtus Global 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 Global Real are associated (or correlated) with Salient Select. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Salient Select Income has no effect on the direction of Virtus Global i.e., Virtus Global and Salient Select go up and down completely randomly.
Pair Corralation between Virtus Global and Salient Select
Assuming the 90 days horizon Virtus Global Real is expected to generate 1.69 times more return on investment than Salient Select. However, Virtus Global is 1.69 times more volatile than Salient Select Income. It trades about 0.04 of its potential returns per unit of risk. Salient Select Income is currently generating about 0.06 per unit of risk. If you would invest 3,019 in Virtus Global Real on November 28, 2024 and sell it today you would earn a total of 484.00 from holding Virtus Global Real or generate 16.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.09% |
| Values | Daily Returns |
Virtus Global Real vs. Salient Select Income
Performance |
| Timeline |
| Virtus Global Real |
| Salient Select Income |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Virtus Global and Salient Select Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Virtus Global and Salient Select
The main advantage of trading using opposite Virtus Global and Salient Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virtus Global position performs unexpectedly, Salient Select 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 Salient Select will offset losses from the drop in Salient Select's long position.| Virtus Global vs. Virtus Global Real | Virtus Global vs. Virtus Global Real | Virtus Global vs. Virtus Global Real | Virtus Global vs. Virtus Kar Mid Cap |
| Salient Select vs. Salient Select Income | Salient Select vs. Ivy High Income | Salient Select vs. Salient Select Income | Salient Select vs. Salient International Real |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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