Correlation Between Voya High and Us Government
Can any of the company-specific risk be diversified away by investing in both Voya High and Us Government 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 High and Us Government into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Voya High Yield and Us Government Securities, you can compare the effects of market volatilities on Voya High and Us Government 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 High with a short position of Us Government. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya High and Us Government.
Diversification Opportunities for Voya High and Us Government
-0.29 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Voya and RGVBX is -0.29. Overlapping area represents the amount of risk that can be diversified away by holding Voya High Yield and Us Government Securities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Us Government Securities and Voya High 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 High Yield are associated (or correlated) with Us Government. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Us Government Securities has no effect on the direction of Voya High i.e., Voya High and Us Government go up and down completely randomly.
Pair Corralation between Voya High and Us Government
Assuming the 90 days horizon Voya High Yield is expected to generate 0.66 times more return on investment than Us Government. However, Voya High Yield is 1.52 times less risky than Us Government. It trades about 0.11 of its potential returns per unit of risk. Us Government Securities is currently generating about 0.01 per unit of risk. If you would invest 599.00 in Voya High Yield on September 12, 2024 and sell it today you would earn a total of 102.00 from holding Voya High Yield or generate 17.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Voya High Yield vs. Us Government Securities
Performance |
| Timeline |
| Voya High Yield |
| Us Government Securities |
Voya High and Us Government Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya High and Us Government
The main advantage of trading using opposite Voya High and Us Government positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya High position performs unexpectedly, Us Government 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 Us Government will offset losses from the drop in Us Government's long position.| Voya High vs. SCOR PK | Voya High vs. Morningstar Unconstrained Allocation | Voya High vs. Via Renewables | Voya High vs. Bondbloxx ETF Trust |
| Us Government vs. Voya High Yield | Us Government vs. Virtus High Yield | Us Government vs. Pax High Yield | Us Government vs. Pace High Yield |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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