Correlation Between Voya Infrastructure and Western Asset
Can any of the company-specific risk be diversified away by investing in both Voya Infrastructure and Western Asset 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 Infrastructure and Western Asset into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Voya Infrastructure Industrials and Western Asset High, you can compare the effects of market volatilities on Voya Infrastructure and Western Asset 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 Infrastructure with a short position of Western Asset. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Infrastructure and Western Asset.
Diversification Opportunities for Voya Infrastructure and Western Asset
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Voya and Western is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Voya Infrastructure Industrial and Western Asset High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Asset High and Voya Infrastructure 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 Infrastructure Industrials are associated (or correlated) with Western Asset. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Asset High has no effect on the direction of Voya Infrastructure i.e., Voya Infrastructure and Western Asset go up and down completely randomly.
Pair Corralation between Voya Infrastructure and Western Asset
Considering the 90-day investment horizon Voya Infrastructure Industrials is expected to under-perform the Western Asset. In addition to that, Voya Infrastructure is 2.45 times more volatile than Western Asset High. It trades about -0.09 of its total potential returns per unit of risk. Western Asset High is currently generating about -0.01 per unit of volatility. If you would invest 1,212 in Western Asset High on September 5, 2024 and sell it today you would lose (2.00) from holding Western Asset High or give up 0.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Voya Infrastructure Industrial vs. Western Asset High
Performance |
| Timeline |
| Voya Infrastructure |
| Western Asset High |
Voya Infrastructure and Western Asset Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya Infrastructure and Western Asset
The main advantage of trading using opposite Voya Infrastructure and Western Asset positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Infrastructure position performs unexpectedly, Western Asset 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 Western Asset will offset losses from the drop in Western Asset's long position.| Voya Infrastructure vs. Western Asset High | Voya Infrastructure vs. Western Asset Global | Voya Infrastructure vs. Western Asset High | Voya Infrastructure vs. Voya Global Equity |
| Western Asset vs. Advent Claymore Convertible | Western Asset vs. Blackstone Gso Strategic | Western Asset vs. Western Asset Investment | Western Asset vs. Pioneer Floating Rate |
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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