Correlation Between Dow Jones and Voya Multi-manager
Can any of the company-specific risk be diversified away by investing in both Dow Jones and Voya Multi-manager 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 Dow Jones and Voya Multi-manager into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dow Jones Industrial and Voya Multi Manager International, you can compare the effects of market volatilities on Dow Jones and Voya Multi-manager 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 Dow Jones with a short position of Voya Multi-manager. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dow Jones and Voya Multi-manager.
Diversification Opportunities for Dow Jones and Voya Multi-manager
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dow and Voya is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding Dow Jones Industrial and Voya Multi Manager Internation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Multi Manager and Dow Jones 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 Dow Jones Industrial are associated (or correlated) with Voya Multi-manager. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Multi Manager has no effect on the direction of Dow Jones i.e., Dow Jones and Voya Multi-manager go up and down completely randomly.
Pair Corralation between Dow Jones and Voya Multi-manager
Assuming the 90 days trading horizon Dow Jones Industrial is expected to generate 1.36 times more return on investment than Voya Multi-manager. However, Dow Jones is 1.36 times more volatile than Voya Multi Manager International. It trades about 0.27 of its potential returns per unit of risk. Voya Multi Manager International is currently generating about -0.1 per unit of risk. If you would invest 4,223,305 in Dow Jones Industrial on August 30, 2024 and sell it today you would earn a total of 248,901 from holding Dow Jones Industrial or generate 5.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dow Jones Industrial vs. Voya Multi Manager Internation
Performance |
| Timeline |
Dow Jones and Voya Multi-manager Volatility Contrast
Predicted Return Density |
| Returns |
Dow Jones Industrial
Pair trading matchups for Dow Jones
Voya Multi Manager International
Pair trading matchups for Voya Multi-manager
Pair Trading with Dow Jones and Voya Multi-manager
The main advantage of trading using opposite Dow Jones and Voya Multi-manager positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dow Jones position performs unexpectedly, Voya Multi-manager 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 Multi-manager will offset losses from the drop in Voya Multi-manager's long position.| Dow Jones vs. Skillful Craftsman Education | Dow Jones vs. Acco Brands | Dow Jones vs. Cracker Barrel Old | Dow Jones vs. Coursera |
| Voya Multi-manager vs. Voya Bond Index | Voya Multi-manager vs. Voya Bond Index | Voya Multi-manager vs. Voya Limited Maturity | Voya Multi-manager 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk |