Correlation Between Virtus Multi and Intech Us

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

By analyzing existing cross correlation between Virtus Multi Strategy Target and Intech Managed Volatility, you can compare the effects of market volatilities on Virtus Multi and Intech Us 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 Multi with a short position of Intech Us. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus Multi and Intech Us.

Diversification Opportunities for Virtus Multi and Intech Us

0.7

Correlation Coefficient

Virtus Multi  Intech Us

Poor diversification

The 3 months correlation between Virtus and Intech is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Virtus Multi Strategy Target and Intech Managed Volatility in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intech Managed Volatility and Virtus Multi 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 Multi Strategy Target are associated (or correlated) with Intech Us. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intech Managed Volatility has no effect on the direction of Virtus Multi i.e., Virtus Multi and Intech Us go up and down completely randomly.

Pair Corralation between Virtus Multi and Intech Us

Assuming the 90 days horizon Virtus Multi is expected to generate 2.7 times less return on investment than Intech Us. But when comparing it to its historical volatility, Virtus Multi Strategy Target is 4.46 times less risky than Intech Us. It trades about 0.07 of its potential returns per unit of risk. Intech Managed Volatility is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest  1,170  in Intech Managed Volatility on October 26, 2024 and sell it today you would earn a total of  24.00  from holding Intech Managed Volatility or generate 2.05% return on investment over 90 days.

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

Virtus Multi Strategy Target  vs.  Intech Managed Volatility

Virtus Multi Strategy

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Virtus Multi Strategy Target are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Virtus Multi is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Intech Managed Volatility

Risk-Adjusted Performance

3 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Intech Managed Volatility are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Intech Us is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Virtus Multi and Intech Us

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

The idea behind Virtus Multi Strategy Target and Intech Managed Volatility 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 Transaction History module to view history of all your transactions and understand their impact on performance.