Correlation Between Virtus Seix and Vanguard Short-term

Can any of the company-specific risk be diversified away by investing in both Virtus Seix and Vanguard Short-term 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 Seix and Vanguard Short-term into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Virtus Seix Government and Vanguard Short Term Inflation Protected, you can compare the effects of market volatilities on Virtus Seix and Vanguard Short-term 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 Seix with a short position of Vanguard Short-term. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus Seix and Vanguard Short-term.

Diversification Opportunities for Virtus Seix and Vanguard Short-term

0.42

Correlation Coefficient

Virtus Seix  Vanguard Short-term

Very weak diversification

The 3 months correlation between Virtus and Vanguard is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Virtus Seix Government and Vanguard Short Term Inflation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Short Term and Virtus Seix 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 Seix Government are associated (or correlated) with Vanguard Short-term. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard Short Term has no effect on the direction of Virtus Seix i.e., Virtus Seix and Vanguard Short-term go up and down completely randomly.

Pair Corralation between Virtus Seix and Vanguard Short-term

Assuming the 90 days horizon Virtus Seix Government is expected to generate 1.25 times more return on investment than Vanguard Short-term. However, Virtus Seix is 1.25 times more volatile than Vanguard Short Term Inflation Protected. It trades about 0.19 of its potential returns per unit of risk. Vanguard Short Term Inflation Protected is currently generating about 0.03 per unit of risk. If you would invest  983.00  in Virtus Seix Government on September 9, 2025 and sell it today you would earn a total of  11.00  from holding Virtus Seix Government or generate 1.12% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Virtus Seix Government  vs.  Vanguard Short Term Inflation

Virtus Seix Government

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Virtus Seix Government are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Virtus Seix is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Vanguard Short Term

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Vanguard Short Term Inflation Protected are ranked lower than 2 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Vanguard Short-term is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Virtus Seix and Vanguard Short-term

The main advantage of trading using opposite Virtus Seix and Vanguard Short-term positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virtus Seix position performs unexpectedly, Vanguard Short-term 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 Vanguard Short-term will offset losses from the drop in Vanguard Short-term's long position.

The idea behind Virtus Seix Government and Vanguard Short Term Inflation Protected 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.

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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.