Correlation Between Scout Core and Virtus Emerging
Can any of the company-specific risk be diversified away by investing in both Scout Core and Virtus Emerging 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 Scout Core and Virtus Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Scout E Bond and Virtus Emerging Markets, you can compare the effects of market volatilities on Scout Core and Virtus Emerging 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 Scout Core with a short position of Virtus Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scout Core and Virtus Emerging.
Diversification Opportunities for Scout Core and Virtus Emerging
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Scout and Virtus is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Scout E Bond and Virtus Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virtus Emerging Markets and Scout Core 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 Scout E Bond are associated (or correlated) with Virtus Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virtus Emerging Markets has no effect on the direction of Scout Core i.e., Scout Core and Virtus Emerging go up and down completely randomly.
Pair Corralation between Scout Core and Virtus Emerging
Assuming the 90 days horizon Scout Core is expected to generate 5.24 times less return on investment than Virtus Emerging. But when comparing it to its historical volatility, Scout E Bond is 1.73 times less risky than Virtus Emerging. It trades about 0.11 of its potential returns per unit of risk. Virtus Emerging Markets is currently generating about 0.33 of returns per unit of risk over similar time horizon. If you would invest 1,541 in Virtus Emerging Markets on April 21, 2025 and sell it today you would earn a total of 187.00 from holding Virtus Emerging Markets or generate 12.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Scout E Bond vs. Virtus Emerging Markets
Performance |
| Timeline |
| Scout E Bond |
| Virtus Emerging Markets |
Scout Core and Virtus Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scout Core and Virtus Emerging
The main advantage of trading using opposite Scout Core and Virtus Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scout Core position performs unexpectedly, Virtus Emerging 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 Emerging will offset losses from the drop in Virtus Emerging's long position.| Scout Core vs. Ab Bond Inflation | Scout Core vs. Tiaa Cref Inflation Link | Scout Core vs. Lord Abbett Inflation | Scout Core vs. Tiaa Cref Inflation Linked Bond |
| Virtus Emerging vs. General Money Market | Virtus Emerging vs. Putnam Money Market | Virtus Emerging vs. Cref Money Market | Virtus Emerging vs. Ubs Money Series |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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