Correlation Between Voya Bond and Vy Jpmorgan
Can any of the company-specific risk be diversified away by investing in both Voya Bond and Vy Jpmorgan 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 Bond and Vy Jpmorgan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Voya Bond Index and Vy Jpmorgan Emerging, you can compare the effects of market volatilities on Voya Bond and Vy Jpmorgan 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 Bond with a short position of Vy Jpmorgan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Bond and Vy Jpmorgan.
Diversification Opportunities for Voya Bond and Vy Jpmorgan
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Voya and IJPTX is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Voya Bond Index and Vy Jpmorgan Emerging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vy Jpmorgan Emerging and Voya Bond 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 Bond Index are associated (or correlated) with Vy Jpmorgan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vy Jpmorgan Emerging has no effect on the direction of Voya Bond i.e., Voya Bond and Vy Jpmorgan go up and down completely randomly.
Pair Corralation between Voya Bond and Vy Jpmorgan
Assuming the 90 days horizon Voya Bond is expected to generate 4.79 times less return on investment than Vy Jpmorgan. But when comparing it to its historical volatility, Voya Bond Index is 1.75 times less risky than Vy Jpmorgan. It trades about 0.07 of its potential returns per unit of risk. Vy Jpmorgan Emerging is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 1,241 in Vy Jpmorgan Emerging on September 17, 2024 and sell it today you would earn a total of 27.00 from holding Vy Jpmorgan Emerging or generate 2.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Voya Bond Index vs. Vy Jpmorgan Emerging
Performance |
| Timeline |
| Voya Bond Index |
| Vy Jpmorgan Emerging |
Voya Bond and Vy Jpmorgan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya Bond and Vy Jpmorgan
The main advantage of trading using opposite Voya Bond and Vy Jpmorgan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Bond position performs unexpectedly, Vy Jpmorgan 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 Vy Jpmorgan will offset losses from the drop in Vy Jpmorgan's long position.| Voya Bond vs. Voya Bond Index | Voya Bond vs. Voya Limited Maturity | Voya Bond vs. Voya Limited Maturity | Voya Bond vs. Voya Bond Index |
| Vy Jpmorgan vs. Voya Bond Index | Vy Jpmorgan vs. Voya Bond Index | Vy Jpmorgan vs. Voya Limited Maturity | Vy Jpmorgan vs. Voya Limited Maturity |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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