Correlation Between Virtus Investment and GEELY AUTOMOBILE
Can any of the company-specific risk be diversified away by investing in both Virtus Investment and GEELY AUTOMOBILE 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 GEELY AUTOMOBILE 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 GEELY AUTOMOBILE, you can compare the effects of market volatilities on Virtus Investment and GEELY AUTOMOBILE 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 GEELY AUTOMOBILE. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus Investment and GEELY AUTOMOBILE.
Diversification Opportunities for Virtus Investment and GEELY AUTOMOBILE
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Virtus and GEELY is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Virtus Investment Partners and GEELY AUTOMOBILE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GEELY AUTOMOBILE 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 GEELY AUTOMOBILE. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GEELY AUTOMOBILE has no effect on the direction of Virtus Investment i.e., Virtus Investment and GEELY AUTOMOBILE go up and down completely randomly.
Pair Corralation between Virtus Investment and GEELY AUTOMOBILE
Assuming the 90 days horizon Virtus Investment Partners is expected to under-perform the GEELY AUTOMOBILE. In addition to that, Virtus Investment is 1.03 times more volatile than GEELY AUTOMOBILE. It trades about -0.41 of its total potential returns per unit of risk. GEELY AUTOMOBILE is currently generating about -0.34 per unit of volatility. If you would invest 194.00 in GEELY AUTOMOBILE on October 12, 2024 and sell it today you would lose (19.00) from holding GEELY AUTOMOBILE or give up 9.79% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 94.44% |
| Values | Daily Returns |
Virtus Investment Partners vs. GEELY AUTOMOBILE
Performance |
| Timeline |
| Virtus Investment |
| GEELY AUTOMOBILE |
Virtus Investment and GEELY AUTOMOBILE Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Virtus Investment and GEELY AUTOMOBILE
The main advantage of trading using opposite Virtus Investment and GEELY AUTOMOBILE positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virtus Investment position performs unexpectedly, GEELY AUTOMOBILE 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 GEELY AUTOMOBILE will offset losses from the drop in GEELY AUTOMOBILE's long position.| Virtus Investment vs. COFCO Joycome Foods | Virtus Investment vs. Corsair Gaming | Virtus Investment vs. GWILLI FOOD | Virtus Investment vs. Austevoll Seafood ASA |
| GEELY AUTOMOBILE vs. HK Electric Investments | GEELY AUTOMOBILE vs. Virtus Investment Partners | GEELY AUTOMOBILE vs. CITY OFFICE REIT | GEELY AUTOMOBILE vs. British American Tobacco |
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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