Correlation Between Matthews China and VictoryShares Small
Can any of the company-specific risk be diversified away by investing in both Matthews China and VictoryShares Small 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 Matthews China and VictoryShares Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Matthews China Discovery and VictoryShares Small Mid, you can compare the effects of market volatilities on Matthews China and VictoryShares Small 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 Matthews China with a short position of VictoryShares Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Matthews China and VictoryShares Small.
Diversification Opportunities for Matthews China and VictoryShares Small
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Matthews and VictoryShares is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Matthews China Discovery and VictoryShares Small Mid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on VictoryShares Small Mid and Matthews China 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 Matthews China Discovery are associated (or correlated) with VictoryShares Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of VictoryShares Small Mid has no effect on the direction of Matthews China i.e., Matthews China and VictoryShares Small go up and down completely randomly.
Pair Corralation between Matthews China and VictoryShares Small
Given the investment horizon of 90 days Matthews China is expected to generate 1.62 times less return on investment than VictoryShares Small. In addition to that, Matthews China is 1.39 times more volatile than VictoryShares Small Mid. It trades about 0.08 of its total potential returns per unit of risk. VictoryShares Small Mid is currently generating about 0.18 per unit of volatility. If you would invest 7,135 in VictoryShares Small Mid on April 4, 2025 and sell it today you would earn a total of 1,404 from holding VictoryShares Small Mid or generate 19.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Matthews China Discovery vs. VictoryShares Small Mid
Performance |
| Timeline |
| Matthews China Discovery |
| VictoryShares Small Mid |
Matthews China and VictoryShares Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Matthews China and VictoryShares Small
The main advantage of trading using opposite Matthews China and VictoryShares Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Matthews China position performs unexpectedly, VictoryShares Small 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 VictoryShares Small will offset losses from the drop in VictoryShares Small's long position.| Matthews China vs. Matthews Emerging Markets | Matthews China vs. Morgan Stanley Pathway | Matthews China vs. Neuberger Berman ETF | Matthews China vs. Harbor ETF Trust |
| VictoryShares Small vs. Vanguard Small Cap Value | VictoryShares Small vs. iShares Russell 2000 | VictoryShares Small vs. iShares SP Mid Cap | VictoryShares Small vs. Dimensional Targeted Value |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| ETFs Find actively traded Exchange Traded Funds (ETF) from around the world |