Correlation Between Global X and Virtus Duff

Can any of the company-specific risk be diversified away by investing in both Global X and Virtus Duff 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 Global X and Virtus Duff into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Global X Robotics and Virtus Duff Phelps, you can compare the effects of market volatilities on Global X and Virtus Duff 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 Global X with a short position of Virtus Duff. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global X and Virtus Duff.

Diversification Opportunities for Global X and Virtus Duff

-0.3

Correlation Coefficient

Global X  Virtus Duff

Very good diversification

The 3 months correlation between Global and Virtus is -0.3. Overlapping area represents the amount of risk that can be diversified away by holding Global X Robotics and Virtus Duff Phelps in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virtus Duff Phelps and Global X 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 Global X Robotics are associated (or correlated) with Virtus Duff. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virtus Duff Phelps has no effect on the direction of Global X i.e., Global X and Virtus Duff go up and down completely randomly.

Pair Corralation between Global X and Virtus Duff

Given the investment horizon of 90 days Global X Robotics is expected to generate 0.96 times more return on investment than Virtus Duff. However, Global X Robotics is 1.04 times less risky than Virtus Duff. It trades about 0.05 of its potential returns per unit of risk. Virtus Duff Phelps is currently generating about 0.01 per unit of risk. If you would invest  2,864  in Global X Robotics on October 7, 2024 and sell it today you would earn a total of  431.00  from holding Global X Robotics or generate 15.05% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Global X Robotics  vs.  Virtus Duff Phelps

Global X Robotics

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Global X Robotics are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, Global X is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Virtus Duff Phelps

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Virtus Duff Phelps has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Etf's essential indicators remain healthy and the recent disarray on Wall Street may also be a sign of long period gains for the ETF investors.

Pair Trading with Global X and Virtus Duff

The main advantage of trading using opposite Global X and Virtus Duff positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global X position performs unexpectedly, Virtus Duff 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 Virtus Duff will offset losses from the drop in Virtus Duff's long position.

The idea behind Global X Robotics and Virtus Duff Phelps 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.

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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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.