Correlation Between Virtus Investment and Lexington Realty
Can any of the company-specific risk be diversified away by investing in both Virtus Investment and Lexington Realty 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 Lexington Realty 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 Lexington Realty Trust, you can compare the effects of market volatilities on Virtus Investment and Lexington Realty 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 Lexington Realty. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus Investment and Lexington Realty.
Diversification Opportunities for Virtus Investment and Lexington Realty
-0.43 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Virtus and Lexington is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Virtus Investment Partners and Lexington Realty Trust in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lexington Realty Trust 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 Lexington Realty. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lexington Realty Trust has no effect on the direction of Virtus Investment i.e., Virtus Investment and Lexington Realty go up and down completely randomly.
Pair Corralation between Virtus Investment and Lexington Realty
Assuming the 90 days horizon Virtus Investment Partners is expected to generate 0.65 times more return on investment than Lexington Realty. However, Virtus Investment Partners is 1.53 times less risky than Lexington Realty. It trades about 0.19 of its potential returns per unit of risk. Lexington Realty Trust is currently generating about -0.09 per unit of risk. If you would invest 22,000 in Virtus Investment Partners on September 12, 2024 and sell it today you would earn a total of 1,400 from holding Virtus Investment Partners or generate 6.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Virtus Investment Partners vs. Lexington Realty Trust
Performance |
| Timeline |
| Virtus Investment |
| Lexington Realty Trust |
Virtus Investment and Lexington Realty Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Virtus Investment and Lexington Realty
The main advantage of trading using opposite Virtus Investment and Lexington Realty positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virtus Investment position performs unexpectedly, Lexington Realty 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 Lexington Realty will offset losses from the drop in Lexington Realty's long position.| Virtus Investment vs. Ameriprise Financial | Virtus Investment vs. Ares Management Corp | Virtus Investment vs. Superior Plus Corp | Virtus Investment vs. SIVERS SEMICONDUCTORS AB |
| Lexington Realty vs. Insurance Australia Group | Lexington Realty vs. CDL INVESTMENT | Lexington Realty vs. Goosehead Insurance | Lexington Realty vs. Ping An Insurance |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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