Correlation Between Virtus Multi-strategy and Manning Napier
Can any of the company-specific risk be diversified away by investing in both Virtus Multi-strategy and Manning Napier 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 Multi-strategy and Manning Napier into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Virtus Multi Strategy Target and Manning Napier Diversified, you can compare the effects of market volatilities on Virtus Multi-strategy and Manning Napier 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 Multi-strategy with a short position of Manning Napier. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus Multi-strategy and Manning Napier.
Diversification Opportunities for Virtus Multi-strategy and Manning Napier
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Virtus and Manning is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Virtus Multi Strategy Target and Manning Napier Diversified in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Manning Napier Diver and Virtus Multi-strategy 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 Multi Strategy Target are associated (or correlated) with Manning Napier. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Manning Napier Diver has no effect on the direction of Virtus Multi-strategy i.e., Virtus Multi-strategy and Manning Napier go up and down completely randomly.
Pair Corralation between Virtus Multi-strategy and Manning Napier
Assuming the 90 days horizon Virtus Multi Strategy Target is expected to generate 1.55 times more return on investment than Manning Napier. However, Virtus Multi-strategy is 1.55 times more volatile than Manning Napier Diversified. It trades about 0.1 of its potential returns per unit of risk. Manning Napier Diversified is currently generating about 0.04 per unit of risk. If you would invest 1,581 in Virtus Multi Strategy Target on October 12, 2024 and sell it today you would earn a total of 216.00 from holding Virtus Multi Strategy Target or generate 13.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.6% |
| Values | Daily Returns |
Virtus Multi Strategy Target vs. Manning Napier Diversified
Performance |
| Timeline |
| Virtus Multi Strategy |
| Manning Napier Diver |
Virtus Multi-strategy and Manning Napier Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Virtus Multi-strategy and Manning Napier
The main advantage of trading using opposite Virtus Multi-strategy and Manning Napier positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virtus Multi-strategy position performs unexpectedly, Manning Napier 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 Manning Napier will offset losses from the drop in Manning Napier's long position.The idea behind Virtus Multi Strategy Target and Manning Napier Diversified pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| Manning Napier vs. Virtus Multi Strategy Target | Manning Napier vs. Balanced Strategy Fund | Manning Napier vs. Inverse Nasdaq 100 Strategy | Manning Napier vs. Eagle Mlp Strategy |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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