Correlation Between Virtus Dfa and GEN Restaurant

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

By analyzing existing cross correlation between Virtus Dfa 2040 and GEN Restaurant Group,, you can compare the effects of market volatilities on Virtus Dfa and GEN Restaurant 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 Dfa with a short position of GEN Restaurant. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus Dfa and GEN Restaurant.

Diversification Opportunities for Virtus Dfa and GEN Restaurant

0.5

Correlation Coefficient

Virtus Dfa  GEN Restaurant

Very weak diversification

The 3 months correlation between Virtus and GEN is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Virtus Dfa 2040 and GEN Restaurant Group, in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GEN Restaurant Group, and Virtus Dfa 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 Dfa 2040 are associated (or correlated) with GEN Restaurant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GEN Restaurant Group, has no effect on the direction of Virtus Dfa i.e., Virtus Dfa and GEN Restaurant go up and down completely randomly.

Pair Corralation between Virtus Dfa and GEN Restaurant

Assuming the 90 days horizon Virtus Dfa is expected to generate 65.47 times less return on investment than GEN Restaurant. But when comparing it to its historical volatility, Virtus Dfa 2040 is 61.98 times less risky than GEN Restaurant. It trades about 0.05 of its potential returns per unit of risk. GEN Restaurant Group, is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest  0.00  in GEN Restaurant Group, on October 4, 2024 and sell it today you would earn a total of  748.00  from holding GEN Restaurant Group, or generate 9.223372036854776E16% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	77.37%
Values	Daily Returns

Virtus Dfa 2040  vs.  GEN Restaurant Group,

Virtus Dfa 2040

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Virtus Dfa 2040 has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

GEN Restaurant Group,

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days GEN Restaurant Group, has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest unsteady performance, the Stock's basic indicators remain persistent and the latest mess on Wall Street may also be a sign of long-standing gains for the company institutional investors.

Pair Trading with Virtus Dfa and GEN Restaurant

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

The idea behind Virtus Dfa 2040 and GEN Restaurant Group, 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 Equity Valuation module to check real value of public entities based on technical and fundamental data.