Correlation Between Virtus Nfj and Ing Series

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Can any of the company-specific risk be diversified away by investing in both Virtus Nfj and Ing Series 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 Nfj and Ing Series into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Virtus Nfj Large Cap and Ing Series Fund, you can compare the effects of market volatilities on Virtus Nfj and Ing Series 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 Nfj with a short position of Ing Series. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus Nfj and Ing Series.

Diversification Opportunities for Virtus Nfj and Ing Series

0.73
  Correlation Coefficient

Poor diversification

The 3 months correlation between Virtus and Ing is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Virtus Nfj Large Cap and Ing Series Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ing Series Fund and Virtus Nfj 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 Nfj Large Cap are associated (or correlated) with Ing Series. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ing Series Fund has no effect on the direction of Virtus Nfj i.e., Virtus Nfj and Ing Series go up and down completely randomly.

Pair Corralation between Virtus Nfj and Ing Series

Assuming the 90 days horizon Virtus Nfj Large Cap is expected to under-perform the Ing Series. But the mutual fund apears to be less risky and, when comparing its historical volatility, Virtus Nfj Large Cap is 1.46 times less risky than Ing Series. The mutual fund trades about -0.08 of its potential returns per unit of risk. The Ing Series Fund is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest  1,425  in Ing Series Fund on September 28, 2024 and sell it today you would lose (8.00) from holding Ing Series Fund or give up 0.56% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Virtus Nfj Large Cap  vs.  Ing Series Fund

 Performance 
       Timeline  
Virtus Nfj Large 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Virtus Nfj Large Cap has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong technical and fundamental indicators, Virtus Nfj is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Ing Series Fund 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Ing Series Fund has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong fundamental drivers, Ing Series is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Virtus Nfj and Ing Series Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Virtus Nfj and Ing Series

The main advantage of trading using opposite Virtus Nfj and Ing Series positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virtus Nfj position performs unexpectedly, Ing Series 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 Ing Series will offset losses from the drop in Ing Series' long position.
The idea behind Virtus Nfj Large Cap and Ing Series Fund 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.
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.

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