Correlation Between Virtus Investment and EBay
Can any of the company-specific risk be diversified away by investing in both Virtus Investment and EBay 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 Investment and EBay into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Virtus Investment Partners and eBay Inc, you can compare the effects of market volatilities on Virtus Investment and EBay 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 Investment with a short position of EBay. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus Investment and EBay.
Diversification Opportunities for Virtus Investment and EBay
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Virtus and EBay is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding Virtus Investment Partners and eBay Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on eBay Inc and Virtus Investment 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 Investment Partners are associated (or correlated) with EBay. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of eBay Inc has no effect on the direction of Virtus Investment i.e., Virtus Investment and EBay go up and down completely randomly.
Pair Corralation between Virtus Investment and EBay
Assuming the 90 days horizon Virtus Investment Partners is expected to generate 1.76 times more return on investment than EBay. However, Virtus Investment is 1.76 times more volatile than eBay Inc. It trades about 0.34 of its potential returns per unit of risk. eBay Inc is currently generating about 0.31 per unit of risk. If you would invest 19,700 in Virtus Investment Partners on September 5, 2024 and sell it today you would earn a total of 3,700 from holding Virtus Investment Partners or generate 18.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Virtus Investment Partners vs. eBay Inc
Performance |
| Timeline |
| Virtus Investment |
| eBay Inc |
Virtus Investment and EBay Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Virtus Investment and EBay
The main advantage of trading using opposite Virtus Investment and EBay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virtus Investment position performs unexpectedly, EBay 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 EBay will offset losses from the drop in EBay's long position.| Virtus Investment vs. CVW CLEANTECH INC | Virtus Investment vs. The Trade Desk | Virtus Investment vs. Clean Energy Fuels | Virtus Investment vs. Cleanaway Waste Management |
| EBay vs. BURLINGTON STORES | EBay vs. Strategic Investments AS | EBay vs. Virtus Investment Partners | EBay vs. Burlington Stores |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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