Correlation Between Us Government and Voya High
Can any of the company-specific risk be diversified away by investing in both Us Government and Voya High 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 Us Government and Voya High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Us Government Securities and Voya High Yield, you can compare the effects of market volatilities on Us Government and Voya High 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 Us Government with a short position of Voya High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Us Government and Voya High.
Diversification Opportunities for Us Government and Voya High
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AMUSX and Voya is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Us Government Securities and Voya High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya High Yield and Us Government 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 Us Government Securities are associated (or correlated) with Voya High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya High Yield has no effect on the direction of Us Government i.e., Us Government and Voya High go up and down completely randomly.
Pair Corralation between Us Government and Voya High
Assuming the 90 days horizon Us Government is expected to generate 65.6 times less return on investment than Voya High. In addition to that, Us Government is 1.95 times more volatile than Voya High Yield. It trades about 0.0 of its total potential returns per unit of risk. Voya High Yield is currently generating about 0.21 per unit of volatility. If you would invest 693.00 in Voya High Yield on August 29, 2024 and sell it today you would earn a total of 5.00 from holding Voya High Yield or generate 0.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Us Government Securities vs. Voya High Yield
Performance |
| Timeline |
| Us Government Securities |
| Voya High Yield |
Us Government and Voya High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Us Government and Voya High
The main advantage of trading using opposite Us Government and Voya High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Us Government position performs unexpectedly, Voya High 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 High will offset losses from the drop in Voya High's long position.| Us Government vs. Bond Fund Of | Us Government vs. Capital World Bond | Us Government vs. American Mutual Fund | Us Government vs. Smallcap World Fund |
| Voya High vs. Us Government Securities | Voya High vs. Lord Abbett Government | Voya High vs. John Hancock Government | Voya High vs. Us Government Securities |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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