Correlation Between Voya Bond and Fidelity Series
Can any of the company-specific risk be diversified away by investing in both Voya Bond and Fidelity Series 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 Fidelity Series 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 Fidelity Series Government, you can compare the effects of market volatilities on Voya Bond and Fidelity Series 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 Fidelity Series. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Bond and Fidelity Series.
Diversification Opportunities for Voya Bond and Fidelity Series
1.0 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Voya and Fidelity is 1.0. Overlapping area represents the amount of risk that can be diversified away by holding Voya Bond Index and Fidelity Series Government in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Series Gove 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 Fidelity Series. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Series Gove has no effect on the direction of Voya Bond i.e., Voya Bond and Fidelity Series go up and down completely randomly.
Pair Corralation between Voya Bond and Fidelity Series
Assuming the 90 days horizon Voya Bond Index is expected to generate 1.02 times more return on investment than Fidelity Series. However, Voya Bond is 1.02 times more volatile than Fidelity Series Government. It trades about -0.1 of its potential returns per unit of risk. Fidelity Series Government is currently generating about -0.12 per unit of risk. If you would invest 908.00 in Voya Bond Index on August 25, 2024 and sell it today you would lose (7.00) from holding Voya Bond Index or give up 0.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Voya Bond Index vs. Fidelity Series Government
Performance |
| Timeline |
| Voya Bond Index |
| Fidelity Series Gove |
Voya Bond and Fidelity Series Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya Bond and Fidelity Series
The main advantage of trading using opposite Voya Bond and Fidelity Series positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Bond position performs unexpectedly, Fidelity Series 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 Fidelity Series will offset losses from the drop in Fidelity Series' long position.| Voya Bond vs. Fidelity Series Government | Voya Bond vs. Blackrock Government Bond | Voya Bond vs. Dws Government Money | Voya Bond vs. Inverse Government Long |
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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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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