Correlation Between Ab Bond and Voya Intermediate
Can any of the company-specific risk be diversified away by investing in both Ab Bond and Voya Intermediate 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 Ab Bond and Voya Intermediate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Bond Inflation and Voya Intermediate Bond, you can compare the effects of market volatilities on Ab Bond and Voya Intermediate 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 Ab Bond with a short position of Voya Intermediate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Bond and Voya Intermediate.
Diversification Opportunities for Ab Bond and Voya Intermediate
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ANBIX and Voya is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Ab Bond Inflation and Voya Intermediate Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Intermediate Bond and Ab Bond 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 Ab Bond Inflation are associated (or correlated) with Voya Intermediate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Intermediate Bond has no effect on the direction of Ab Bond i.e., Ab Bond and Voya Intermediate go up and down completely randomly.
Pair Corralation between Ab Bond and Voya Intermediate
Assuming the 90 days horizon Ab Bond is expected to generate 1.05 times less return on investment than Voya Intermediate. But when comparing it to its historical volatility, Ab Bond Inflation is 2.2 times less risky than Voya Intermediate. It trades about 0.21 of its potential returns per unit of risk. Voya Intermediate Bond is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 1,080 in Voya Intermediate Bond on September 4, 2024 and sell it today you would earn a total of 8.00 from holding Voya Intermediate Bond or generate 0.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Ab Bond Inflation vs. Voya Intermediate Bond
Performance |
| Timeline |
| Ab Bond Inflation |
| Voya Intermediate Bond |
Ab Bond and Voya Intermediate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Bond and Voya Intermediate
The main advantage of trading using opposite Ab Bond and Voya Intermediate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Bond position performs unexpectedly, Voya Intermediate 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 Intermediate will offset losses from the drop in Voya Intermediate's long position.| Ab Bond vs. Fidelity Sai Convertible | Ab Bond vs. Putnam Convertible Incm Gwth | Ab Bond vs. Calamos Dynamic Convertible | Ab Bond vs. Advent Claymore Convertible |
| Voya Intermediate vs. Voya Bond Index | Voya Intermediate vs. Voya Bond Index | Voya Intermediate vs. Voya Limited Maturity | Voya Intermediate vs. Voya Limited Maturity |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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