Correlation Between Calvert Developed and Voya Index
Can any of the company-specific risk be diversified away by investing in both Calvert Developed and Voya Index 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 Calvert Developed and Voya Index into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calvert Developed Market and Voya Index Plus, you can compare the effects of market volatilities on Calvert Developed and Voya Index 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 Calvert Developed with a short position of Voya Index. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calvert Developed and Voya Index.
Diversification Opportunities for Calvert Developed and Voya Index
-0.44 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Calvert and Voya is -0.44. Overlapping area represents the amount of risk that can be diversified away by holding Calvert Developed Market and Voya Index Plus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Index Plus and Calvert Developed 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 Calvert Developed Market are associated (or correlated) with Voya Index. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Index Plus has no effect on the direction of Calvert Developed i.e., Calvert Developed and Voya Index go up and down completely randomly.
Pair Corralation between Calvert Developed and Voya Index
Assuming the 90 days horizon Calvert Developed is expected to generate 1.51 times less return on investment than Voya Index. But when comparing it to its historical volatility, Calvert Developed Market is 1.63 times less risky than Voya Index. It trades about 0.07 of its potential returns per unit of risk. Voya Index Plus is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,853 in Voya Index Plus on September 12, 2024 and sell it today you would earn a total of 541.00 from holding Voya Index Plus or generate 29.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Calvert Developed Market vs. Voya Index Plus
Performance |
| Timeline |
| Calvert Developed Market |
| Voya Index Plus |
Calvert Developed and Voya Index Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Calvert Developed and Voya Index
The main advantage of trading using opposite Calvert Developed and Voya Index positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calvert Developed position performs unexpectedly, Voya Index 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 Index will offset losses from the drop in Voya Index's long position.| Calvert Developed vs. SCOR PK | Calvert Developed vs. Morningstar Unconstrained Allocation | Calvert Developed vs. Via Renewables | Calvert Developed vs. Bondbloxx ETF Trust |
| Voya Index vs. Shelton Emerging Markets | Voya Index vs. Origin Emerging Markets | Voya Index vs. Calvert Developed Market | Voya Index vs. Ashmore Emerging Markets |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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