Correlation Between Virtus Investment and Compagnie
Can any of the company-specific risk be diversified away by investing in both Virtus Investment and Compagnie 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 Compagnie 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 Compagnie de Saint Gobain, you can compare the effects of market volatilities on Virtus Investment and Compagnie 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 Compagnie. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus Investment and Compagnie.
Diversification Opportunities for Virtus Investment and Compagnie
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between Virtus and Compagnie is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Virtus Investment Partners and Compagnie de Saint Gobain in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Compagnie de Saint 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 Compagnie. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Compagnie de Saint has no effect on the direction of Virtus Investment i.e., Virtus Investment and Compagnie go up and down completely randomly.
Pair Corralation between Virtus Investment and Compagnie
Assuming the 90 days horizon Virtus Investment Partners is expected to under-perform the Compagnie. In addition to that, Virtus Investment is 1.19 times more volatile than Compagnie de Saint Gobain. It trades about -0.16 of its total potential returns per unit of risk. Compagnie de Saint Gobain is currently generating about 0.21 per unit of volatility. If you would invest 8,562 in Compagnie de Saint Gobain on November 5, 2024 and sell it today you would earn a total of 498.00 from holding Compagnie de Saint Gobain or generate 5.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Virtus Investment Partners vs. Compagnie de Saint Gobain
Performance |
| Timeline |
| Virtus Investment |
| Compagnie de Saint |
Virtus Investment and Compagnie Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Virtus Investment and Compagnie
The main advantage of trading using opposite Virtus Investment and Compagnie positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virtus Investment position performs unexpectedly, Compagnie 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 Compagnie will offset losses from the drop in Compagnie's long position.| Virtus Investment vs. MEDICAL FACILITIES NEW | Virtus Investment vs. Merit Medical Systems | Virtus Investment vs. CVR Medical Corp | Virtus Investment vs. Corsair Gaming |
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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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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