Correlation Between Voya Solution and Virtus High
Can any of the company-specific risk be diversified away by investing in both Voya Solution and Virtus High 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 Virtus High 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 Virtus High Yield, you can compare the effects of market volatilities on Voya Solution and Virtus High 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 Virtus High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Solution and Virtus High.
Diversification Opportunities for Voya Solution and Virtus High
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Voya and Virtus is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Voya Solution Aggressive and Virtus High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virtus High Yield 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 Virtus High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virtus High Yield has no effect on the direction of Voya Solution i.e., Voya Solution and Virtus High go up and down completely randomly.
Pair Corralation between Voya Solution and Virtus High
Assuming the 90 days horizon Voya Solution Aggressive is expected to generate 4.32 times more return on investment than Virtus High. However, Voya Solution is 4.32 times more volatile than Virtus High Yield. It trades about 0.17 of its potential returns per unit of risk. Virtus High Yield is currently generating about 0.22 per unit of risk. If you would invest 1,429 in Voya Solution Aggressive on August 27, 2024 and sell it today you would earn a total of 37.00 from holding Voya Solution Aggressive or generate 2.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Voya Solution Aggressive vs. Virtus High Yield
Performance |
| Timeline |
| Voya Solution Aggressive |
| Virtus High Yield |
Voya Solution and Virtus High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya Solution and Virtus High
The main advantage of trading using opposite Voya Solution and Virtus High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Solution position performs unexpectedly, Virtus High 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 Virtus High will offset losses from the drop in Virtus High'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 |
| Virtus High vs. Delaware Healthcare Fund | Virtus High vs. Invesco Global Health | Virtus High vs. Blackrock Health Sciences | Virtus High vs. Alphacentric Lifesci Healthcare |
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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