Correlation Between Virtus Convertible and Mainstay International
Can any of the company-specific risk be diversified away by investing in both Virtus Convertible and Mainstay International 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 Convertible and Mainstay International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Virtus Convertible and Mainstay International Opportunities, you can compare the effects of market volatilities on Virtus Convertible and Mainstay International 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 Convertible with a short position of Mainstay International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus Convertible and Mainstay International.
Diversification Opportunities for Virtus Convertible and Mainstay International
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Virtus and Mainstay is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Virtus Convertible and Mainstay International Opportu in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay International and Virtus Convertible 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 Convertible are associated (or correlated) with Mainstay International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay International has no effect on the direction of Virtus Convertible i.e., Virtus Convertible and Mainstay International go up and down completely randomly.
Pair Corralation between Virtus Convertible and Mainstay International
Assuming the 90 days horizon Virtus Convertible is expected to under-perform the Mainstay International. In addition to that, Virtus Convertible is 1.29 times more volatile than Mainstay International Opportunities. It trades about -0.21 of its total potential returns per unit of risk. Mainstay International Opportunities is currently generating about -0.09 per unit of volatility. If you would invest 764.00 in Mainstay International Opportunities on September 25, 2024 and sell it today you would lose (9.00) from holding Mainstay International Opportunities or give up 1.18% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Virtus Convertible vs. Mainstay International Opportu
Performance |
Timeline |
Virtus Convertible |
Mainstay International |
Virtus Convertible and Mainstay International Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Virtus Convertible and Mainstay International
The main advantage of trading using opposite Virtus Convertible and Mainstay International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virtus Convertible position performs unexpectedly, Mainstay International 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 Mainstay International will offset losses from the drop in Mainstay International's long position.Virtus Convertible vs. Virtus Multi Strategy Target | Virtus Convertible vs. Virtus Multi Sector Short | Virtus Convertible vs. Ridgeworth Seix High | Virtus Convertible vs. Ridgeworth Innovative Growth |
Mainstay International vs. Mainstay High Yield | Mainstay International vs. Mainstay Tax Free | Mainstay International vs. Mainstay Income Builder | Mainstay International vs. Mainstay Large Cap |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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