Correlation Between STRA Hannoversche and Voya Financial
Can any of the company-specific risk be diversified away by investing in both STRA Hannoversche 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 STRA Hannoversche and Voya Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between STRA Hannoversche Verkehrsbetriebe and Voya Financial, you can compare the effects of market volatilities on STRA Hannoversche 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 STRA Hannoversche with a short position of Voya Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of STRA Hannoversche and Voya Financial.
Diversification Opportunities for STRA Hannoversche and Voya Financial
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between STRA and Voya is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding STRA Hannoversche Verkehrsbetr and Voya Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Financial and STRA Hannoversche 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 STRA Hannoversche Verkehrsbetriebe 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 STRA Hannoversche i.e., STRA Hannoversche and Voya Financial go up and down completely randomly.
Pair Corralation between STRA Hannoversche and Voya Financial
Assuming the 90 days horizon STRA Hannoversche Verkehrsbetriebe is expected to under-perform the Voya Financial. In addition to that, STRA Hannoversche is 2.2 times more volatile than Voya Financial. It trades about -0.01 of its total potential returns per unit of risk. Voya Financial is currently generating about 0.02 per unit of volatility. If you would invest 6,161 in Voya Financial on September 19, 2024 and sell it today you would earn a total of 439.00 from holding Voya Financial or generate 7.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.75% |
| Values | Daily Returns |
STRA Hannoversche Verkehrsbetr vs. Voya Financial
Performance |
| Timeline |
| STRA Hannoversche |
| Voya Financial |
STRA Hannoversche and Voya Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with STRA Hannoversche and Voya Financial
The main advantage of trading using opposite STRA Hannoversche and Voya Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if STRA Hannoversche 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.| STRA Hannoversche vs. CSX Corporation | STRA Hannoversche vs. Westinghouse Air Brake | STRA Hannoversche vs. Superior Plus Corp | STRA Hannoversche vs. SIVERS SEMICONDUCTORS AB |
| Voya Financial vs. Charoen Pokphand Foods | Voya Financial vs. CN MODERN DAIRY | Voya Financial vs. INDOFOOD AGRI RES | Voya Financial vs. SIDETRADE EO 1 |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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