VRT: factor decomposition (Technology)

How much of VRT's move over the window is systematic (market, XLK sector-excess, rate-excess via TLT) vs. idiosyncratic (stock-specific).

Return decomposition (log-return points, additive)

Market+54.88ppSector (excess)+67.69ppRate (excess)+1.19ppIdiosyncratic-57.46pp

Factor betas

Beta · Market (SPY)+2.72
Beta · Sector-excess (XLK)+1.63
Beta · Rate-excess (TLT)-0.33
R²0.41
Window2025-08-22 → 2026-09-24 (273 trading days)

Read

R² is 0.41: a reasonably reliable fit; the betas and the split below are worth reading at face value.

Of VRT's +66.3pp move over this window, -57.5pp (87% of the total magnitude) is idiosyncratic, not explained by riding market, sector, or rate moves. The rest (+123.8pp) came from systematic exposure: market +54.9pp, sector +67.7pp, rate +1.2pp.

Generated 2026-09-25 07:03 UTC · factor-decomposition · simple 3-factor OLS (market, sector-excess, rate-excess, mutually orthogonalized) · log returns, additive over the window · a transparent estimate, not a commercial risk model: treat betas as directional, always check R² first.