Correlation Between Federated Mdt and Virtus Kar
Can any of the company-specific risk be diversified away by investing in both Federated Mdt and Virtus Kar 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 Federated Mdt and Virtus Kar into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Mdt Small and Virtus Kar Small Cap, you can compare the effects of market volatilities on Federated Mdt and Virtus Kar 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 Federated Mdt with a short position of Virtus Kar. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Mdt and Virtus Kar.
Diversification Opportunities for Federated Mdt and Virtus Kar
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Federated and Virtus is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Federated Mdt Small and Virtus Kar Small Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virtus Kar Small and Federated Mdt 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 Federated Mdt Small are associated (or correlated) with Virtus Kar. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virtus Kar Small has no effect on the direction of Federated Mdt i.e., Federated Mdt and Virtus Kar go up and down completely randomly.
Pair Corralation between Federated Mdt and Virtus Kar
Assuming the 90 days horizon Federated Mdt Small is expected to generate 1.04 times more return on investment than Virtus Kar. However, Federated Mdt is 1.04 times more volatile than Virtus Kar Small Cap. It trades about 0.23 of its potential returns per unit of risk. Virtus Kar Small Cap is currently generating about 0.11 per unit of risk. If you would invest 2,748 in Federated Mdt Small on April 22, 2025 and sell it today you would earn a total of 126.00 from holding Federated Mdt Small or generate 4.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Federated Mdt Small vs. Virtus Kar Small Cap
Performance |
| Timeline |
| Federated Mdt Small |
| Virtus Kar Small |
Federated Mdt and Virtus Kar Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Mdt and Virtus Kar
The main advantage of trading using opposite Federated Mdt and Virtus Kar positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Mdt position performs unexpectedly, Virtus Kar 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 Virtus Kar will offset losses from the drop in Virtus Kar's long position.| Federated Mdt vs. Touchstone Mid Cap | Federated Mdt vs. Virtus Kar Small Cap | Federated Mdt vs. Mid Cap Growth | Federated Mdt vs. Harding Loevner International |
| Virtus Kar vs. Financial Industries Fund | Virtus Kar vs. John Hancock Financial | Virtus Kar vs. Angel Oak Financial | Virtus Kar vs. Rmb Mendon Financial |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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