Correlation Between Virtus ETF and Vanguard Total
Can any of the company-specific risk be diversified away by investing in both Virtus ETF and Vanguard Total 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 ETF and Vanguard Total into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Virtus ETF Trust and Vanguard Total International, you can compare the effects of market volatilities on Virtus ETF and Vanguard Total 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 ETF with a short position of Vanguard Total. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus ETF and Vanguard Total.
Diversification Opportunities for Virtus ETF and Vanguard Total
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Virtus and Vanguard is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Virtus ETF Trust and Vanguard Total International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Total Inter and Virtus ETF 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 ETF Trust are associated (or correlated) with Vanguard Total. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard Total Inter has no effect on the direction of Virtus ETF i.e., Virtus ETF and Vanguard Total go up and down completely randomly.
Pair Corralation between Virtus ETF and Vanguard Total
Given the investment horizon of 90 days Virtus ETF Trust is expected to generate 1.71 times more return on investment than Vanguard Total. However, Virtus ETF is 1.71 times more volatile than Vanguard Total International. It trades about 0.09 of its potential returns per unit of risk. Vanguard Total International is currently generating about 0.1 per unit of risk. If you would invest 2,622 in Virtus ETF Trust on September 23, 2024 and sell it today you would earn a total of 36.00 from holding Virtus ETF Trust or generate 1.37% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Virtus ETF Trust vs. Vanguard Total International
Performance |
Timeline |
Virtus ETF Trust |
Vanguard Total Inter |
Virtus ETF and Vanguard Total Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Virtus ETF and Vanguard Total
The main advantage of trading using opposite Virtus ETF and Vanguard Total positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virtus ETF position performs unexpectedly, Vanguard Total 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 Vanguard Total will offset losses from the drop in Vanguard Total's long position.Virtus ETF vs. Vanguard Total International | Virtus ETF vs. Vanguard Long Term Corporate | Virtus ETF vs. Vanguard Short Term Inflation Protected | Virtus ETF vs. Vanguard Intermediate Term Corporate |
Vanguard Total vs. Vanguard Total Corporate | Vanguard Total vs. Vanguard Emerging Markets | Vanguard Total vs. Vanguard Intermediate Term Treasury | Vanguard Total vs. Vanguard Short Term Treasury |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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