Correlation Between Global Gold and Voya Vacs
Can any of the company-specific risk be diversified away by investing in both Global Gold and Voya Vacs 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 Global Gold and Voya Vacs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Global Gold Fund and Voya Vacs Index, you can compare the effects of market volatilities on Global Gold and Voya Vacs 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 Global Gold with a short position of Voya Vacs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Global Gold and Voya Vacs.
Diversification Opportunities for Global Gold and Voya Vacs
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Global and Voya is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Global Gold Fund and Voya Vacs Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Vacs Index and Global Gold 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 Global Gold Fund are associated (or correlated) with Voya Vacs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Vacs Index has no effect on the direction of Global Gold i.e., Global Gold and Voya Vacs go up and down completely randomly.
Pair Corralation between Global Gold and Voya Vacs
Assuming the 90 days horizon Global Gold Fund is expected to generate 1.64 times more return on investment than Voya Vacs. However, Global Gold is 1.64 times more volatile than Voya Vacs Index. It trades about 0.01 of its potential returns per unit of risk. Voya Vacs Index is currently generating about -0.2 per unit of risk. If you would invest 1,361 in Global Gold Fund on December 3, 2024 and sell it today you would earn a total of 0.00 from holding Global Gold Fund or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Global Gold Fund vs. Voya Vacs Index
Performance |
| Timeline |
| Global Gold Fund |
| Voya Vacs Index |
Global Gold and Voya Vacs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Global Gold and Voya Vacs
The main advantage of trading using opposite Global Gold and Voya Vacs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Global Gold position performs unexpectedly, Voya Vacs 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 Voya Vacs will offset losses from the drop in Voya Vacs' long position.| Global Gold vs. Gmo High Yield | Global Gold vs. Ab High Income | Global Gold vs. Siit High Yield | Global Gold vs. Barings High Yield |
| Voya Vacs vs. Alternative Asset Allocation | Voya Vacs vs. Versatile Bond Portfolio | Voya Vacs vs. Buffalo High Yield | Voya Vacs vs. Credit Suisse Multialternative |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Transaction History View history of all your transactions and understand their impact on performance | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |