Correlation Between Voya Solution and Transamerica Financial
Can any of the company-specific risk be diversified away by investing in both Voya Solution and Transamerica 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 Voya Solution and Transamerica Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Voya Solution Aggressive and Transamerica Financial Life, you can compare the effects of market volatilities on Voya Solution and Transamerica 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 Voya Solution with a short position of Transamerica Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Solution and Transamerica Financial.
Diversification Opportunities for Voya Solution and Transamerica Financial
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Voya and Transamerica is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Voya Solution Aggressive and Transamerica Financial Life in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Transamerica Financial and Voya Solution 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 Voya Solution Aggressive are associated (or correlated) with Transamerica Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Transamerica Financial has no effect on the direction of Voya Solution i.e., Voya Solution and Transamerica Financial go up and down completely randomly.
Pair Corralation between Voya Solution and Transamerica Financial
Assuming the 90 days horizon Voya Solution is expected to generate 1.22 times less return on investment than Transamerica Financial. But when comparing it to its historical volatility, Voya Solution Aggressive is 1.15 times less risky than Transamerica Financial. It trades about 0.36 of its potential returns per unit of risk. Transamerica Financial Life is currently generating about 0.38 of returns per unit of risk over similar time horizon. If you would invest 1,175 in Transamerica Financial Life on September 2, 2024 and sell it today you would earn a total of 72.00 from holding Transamerica Financial Life or generate 6.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Voya Solution Aggressive vs. Transamerica Financial Life
Performance |
| Timeline |
| Voya Solution Aggressive |
| Transamerica Financial |
Voya Solution and Transamerica Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya Solution and Transamerica Financial
The main advantage of trading using opposite Voya Solution and Transamerica Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Solution position performs unexpectedly, Transamerica 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 Transamerica Financial will offset losses from the drop in Transamerica Financial's long position.| Voya Solution vs. Voya Bond Index | Voya Solution vs. Voya Bond Index | Voya Solution vs. Voya Limited Maturity | Voya Solution vs. Voya Limited Maturity |
| Transamerica Financial vs. Allianzgi Health Sciences | Transamerica Financial vs. Hartford Healthcare Hls | Transamerica Financial vs. Baillie Gifford Health | Transamerica Financial vs. Deutsche Health And |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
Other Complementary Tools
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes |