Correlation Between Virtus Investment and Walmart

Can any of the company-specific risk be diversified away by investing in both Virtus Investment and Walmart 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 Walmart 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 Walmart, you can compare the effects of market volatilities on Virtus Investment and Walmart 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 Walmart. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus Investment and Walmart.

Diversification Opportunities for Virtus Investment and Walmart

0.58

Correlation Coefficient

Virtus Investment  Walmart

Very weak diversification

The 3 months correlation between Virtus and Walmart is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Virtus Investment Partners and Walmart in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Walmart 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 Walmart. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Walmart has no effect on the direction of Virtus Investment i.e., Virtus Investment and Walmart go up and down completely randomly.

Pair Corralation between Virtus Investment and Walmart

Assuming the 90 days horizon Virtus Investment Partners is expected to under-perform the Walmart. In addition to that, Virtus Investment is 1.86 times more volatile than Walmart. It trades about -0.1 of its total potential returns per unit of risk. Walmart is currently generating about 0.27 per unit of volatility. If you would invest  8,587  in Walmart on October 22, 2024 and sell it today you would earn a total of  337.00  from holding Walmart or generate 3.92% return on investment over 90 days.

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

Virtus Investment Partners  vs.  Walmart

Virtus Investment

Risk-Adjusted Performance

3 of 100

Very Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Virtus Investment Partners are ranked lower than 3 (%) of all global equities and portfolios over the last 90 days. Despite nearly stable basic indicators, Virtus Investment is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Walmart

Risk-Adjusted Performance

17 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Walmart are ranked lower than 17 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile basic indicators, Walmart unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Virtus Investment and Walmart

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

The idea behind Virtus Investment Partners and Walmart 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.