Correlation Between Martin Currie and Virtus Duff

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

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

Diversification Opportunities for Martin Currie and Virtus Duff

0.42

Correlation Coefficient

Martin Currie  Virtus Duff

Very weak diversification

The 3 months correlation between Martin and Virtus is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Martin Currie Sustainable 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 Martin Currie 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 Martin Currie Sustainable 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 Martin Currie i.e., Martin Currie and Virtus Duff go up and down completely randomly.

Pair Corralation between Martin Currie and Virtus Duff

Given the investment horizon of 90 days Martin Currie Sustainable is expected to generate 0.8 times more return on investment than Virtus Duff. However, Martin Currie Sustainable is 1.25 times less risky than Virtus Duff. It trades about -0.03 of its potential returns per unit of risk. Virtus Duff Phelps is currently generating about -0.04 per unit of risk. If you would invest  1,431  in Martin Currie Sustainable on October 24, 2024 and sell it today you would lose (32.00) from holding Martin Currie Sustainable or give up 2.24% of portfolio value over 90 days.

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

Martin Currie Sustainable  vs.  Virtus Duff Phelps

Martin Currie Sustainable

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Martin Currie Sustainable has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, Martin Currie is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

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 very healthy essential indicators, Virtus Duff is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with Martin Currie and Virtus Duff

The main advantage of trading using opposite Martin Currie and Virtus Duff positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Martin Currie 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 Martin Currie Sustainable 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.