Correlation Between Strategic Investments and Voya Financial
Can any of the company-specific risk be diversified away by investing in both Strategic Investments and Voya Financial 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 Strategic Investments and Voya Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Strategic Investments AS and Voya Financial, you can compare the effects of market volatilities on Strategic Investments and Voya Financial 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 Strategic Investments with a short position of Voya Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Strategic Investments and Voya Financial.
Diversification Opportunities for Strategic Investments and Voya Financial
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Strategic and Voya is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Strategic Investments AS and Voya Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Financial and Strategic Investments 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 Strategic Investments AS are associated (or correlated) with Voya Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Financial has no effect on the direction of Strategic Investments i.e., Strategic Investments and Voya Financial go up and down completely randomly.
Pair Corralation between Strategic Investments and Voya Financial
Assuming the 90 days horizon Strategic Investments AS is expected to generate 1.43 times more return on investment than Voya Financial. However, Strategic Investments is 1.43 times more volatile than Voya Financial. It trades about 0.02 of its potential returns per unit of risk. Voya Financial is currently generating about -0.35 per unit of risk. If you would invest 14.00 in Strategic Investments AS on September 26, 2024 and sell it today you would earn a total of 0.00 from holding Strategic Investments AS or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Strategic Investments AS vs. Voya Financial
Performance |
| Timeline |
| Strategic Investments |
| Voya Financial |
Strategic Investments and Voya Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Strategic Investments and Voya Financial
The main advantage of trading using opposite Strategic Investments and Voya Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Strategic Investments position performs unexpectedly, Voya Financial 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 Financial will offset losses from the drop in Voya Financial's long position.| Strategic Investments vs. Blackstone Group | Strategic Investments vs. The Bank of | Strategic Investments vs. Ameriprise Financial | Strategic Investments vs. State Street |
| Voya Financial vs. Treasury Wine Estates | Voya Financial vs. Gladstone Investment | Voya Financial vs. FUTURE GAMING GRP | Voya Financial vs. Strategic Investments AS |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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