Correlation Between Virtus Investment and Rithm Capital
Can any of the company-specific risk be diversified away by investing in both Virtus Investment and Rithm Capital 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 Rithm Capital 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 Rithm Capital Corp, you can compare the effects of market volatilities on Virtus Investment and Rithm Capital 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 Rithm Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus Investment and Rithm Capital.
Diversification Opportunities for Virtus Investment and Rithm Capital
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Virtus and Rithm is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Virtus Investment Partners, and Rithm Capital Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rithm Capital Corp 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 Rithm Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rithm Capital Corp has no effect on the direction of Virtus Investment i.e., Virtus Investment and Rithm Capital go up and down completely randomly.
Pair Corralation between Virtus Investment and Rithm Capital
Given the investment horizon of 90 days Virtus Investment Partners, is expected to generate 1.77 times more return on investment than Rithm Capital. However, Virtus Investment is 1.77 times more volatile than Rithm Capital Corp. It trades about 0.04 of its potential returns per unit of risk. Rithm Capital Corp is currently generating about 0.02 per unit of risk. If you would invest 22,439 in Virtus Investment Partners, on August 24, 2024 and sell it today you would earn a total of 1,501 from holding Virtus Investment Partners, or generate 6.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Virtus Investment Partners, vs. Rithm Capital Corp
Performance |
| Timeline |
| Virtus Investment |
| Rithm Capital Corp |
Virtus Investment and Rithm Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Virtus Investment and Rithm Capital
The main advantage of trading using opposite Virtus Investment and Rithm Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virtus Investment position performs unexpectedly, Rithm Capital 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 Rithm Capital will offset losses from the drop in Rithm Capital's long position.| Virtus Investment vs. Invesco Advantage MIT | Virtus Investment vs. Invesco Municipal Trust | Virtus Investment vs. Invesco California Value | Virtus Investment vs. Tri Continental Closed |
| Rithm Capital vs. Starwood Property Trust | Rithm Capital vs. AGNC Investment Corp | Rithm Capital vs. Blackstone Mortgage Trust | Rithm Capital vs. Ares Commercial Real |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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