Correlation Between Virtus ETF and Virtus Newfleet
Can any of the company-specific risk be diversified away by investing in both Virtus ETF and Virtus Newfleet 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 ETF and Virtus Newfleet into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Virtus ETF Trust and Virtus Newfleet ABSMBS, you can compare the effects of market volatilities on Virtus ETF and Virtus Newfleet 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 ETF with a short position of Virtus Newfleet. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus ETF and Virtus Newfleet.
Diversification Opportunities for Virtus ETF and Virtus Newfleet
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Virtus and Virtus is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Virtus ETF Trust and Virtus Newfleet ABSMBS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virtus Newfleet ABSMBS and Virtus ETF 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 ETF Trust are associated (or correlated) with Virtus Newfleet. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virtus Newfleet ABSMBS has no effect on the direction of Virtus ETF i.e., Virtus ETF and Virtus Newfleet go up and down completely randomly.
Pair Corralation between Virtus ETF and Virtus Newfleet
Given the investment horizon of 90 days Virtus ETF is expected to generate 1.36 times less return on investment than Virtus Newfleet. In addition to that, Virtus ETF is 1.86 times more volatile than Virtus Newfleet ABSMBS. It trades about 0.08 of its total potential returns per unit of risk. Virtus Newfleet ABSMBS is currently generating about 0.19 per unit of volatility. If you would invest 2,398 in Virtus Newfleet ABSMBS on March 26, 2025 and sell it today you would earn a total of 43.00 from holding Virtus Newfleet ABSMBS or generate 1.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Virtus ETF Trust vs. Virtus Newfleet ABSMBS
Performance |
| Timeline |
| Virtus ETF Trust |
| Virtus Newfleet ABSMBS |
Virtus ETF and Virtus Newfleet Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Virtus ETF and Virtus Newfleet
The main advantage of trading using opposite Virtus ETF and Virtus Newfleet positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virtus ETF position performs unexpectedly, Virtus Newfleet 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 Newfleet will offset losses from the drop in Virtus Newfleet's long position.| Virtus ETF vs. Franklin Liberty Senior | Virtus ETF vs. Virtus Newfleet Multi Sector | Virtus ETF vs. Pacer Pacific Asset | Virtus ETF vs. JPMorgan USD Emerging |
| Virtus Newfleet vs. Virtus ETF Trust | Virtus Newfleet vs. Virtus Newfleet Multi Sector | Virtus Newfleet vs. Virtus WMC International | Virtus Newfleet vs. T Rowe Price |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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