Correlation Between Highland Long/short and Voya Target
Can any of the company-specific risk be diversified away by investing in both Highland Long/short and Voya Target 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 Highland Long/short and Voya Target into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Highland Longshort Healthcare and Voya Target Retirement, you can compare the effects of market volatilities on Highland Long/short and Voya Target 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 Highland Long/short with a short position of Voya Target. Check out your portfolio center. Please also check ongoing floating volatility patterns of Highland Long/short and Voya Target.
Diversification Opportunities for Highland Long/short and Voya Target
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Highland and Voya is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Highland Longshort Healthcare and Voya Target Retirement in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Target Retirement and Highland Long/short 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 Highland Longshort Healthcare are associated (or correlated) with Voya Target. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Target Retirement has no effect on the direction of Highland Long/short i.e., Highland Long/short and Voya Target go up and down completely randomly.
Pair Corralation between Highland Long/short and Voya Target
Assuming the 90 days horizon Highland Long/short is expected to generate 1.81 times less return on investment than Voya Target. But when comparing it to its historical volatility, Highland Longshort Healthcare is 3.0 times less risky than Voya Target. It trades about 0.12 of its potential returns per unit of risk. Voya Target Retirement is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,087 in Voya Target Retirement on October 11, 2024 and sell it today you would earn a total of 251.00 from holding Voya Target Retirement or generate 23.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Highland Longshort Healthcare vs. Voya Target Retirement
Performance |
| Timeline |
| Highland Long/short |
| Voya Target Retirement |
Highland Long/short and Voya Target Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Highland Long/short and Voya Target
The main advantage of trading using opposite Highland Long/short and Voya Target positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Highland Long/short position performs unexpectedly, Voya Target 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 Target will offset losses from the drop in Voya Target's long position.| Highland Long/short vs. Mesirow Financial Small | Highland Long/short vs. Blackstone Secured Lending | Highland Long/short vs. Prudential Financial Services | Highland Long/short vs. 1919 Financial Services |
| Voya Target vs. The Gabelli Healthcare | Voya Target vs. Highland Longshort Healthcare | Voya Target vs. Tekla Healthcare Investors | Voya Target vs. Alger Health Sciences |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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