Correlation Between Voya High and Nationwide Growth
Can any of the company-specific risk be diversified away by investing in both Voya High and Nationwide Growth 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 Nationwide Growth 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 Nationwide Growth Fund, you can compare the effects of market volatilities on Voya High and Nationwide Growth 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 Nationwide Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya High and Nationwide Growth.
Diversification Opportunities for Voya High and Nationwide Growth
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Voya and NATIONWIDE is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Voya High Yield and Nationwide Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nationwide Growth 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 Nationwide Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nationwide Growth has no effect on the direction of Voya High i.e., Voya High and Nationwide Growth go up and down completely randomly.
Pair Corralation between Voya High and Nationwide Growth
Assuming the 90 days horizon Voya High is expected to generate 3.43 times less return on investment than Nationwide Growth. But when comparing it to its historical volatility, Voya High Yield is 5.33 times less risky than Nationwide Growth. It trades about 0.27 of its potential returns per unit of risk. Nationwide Growth Fund is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 1,507 in Nationwide Growth Fund on August 31, 2024 and sell it today you would earn a total of 47.00 from holding Nationwide Growth Fund or generate 3.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Voya High Yield vs. Nationwide Growth Fund
Performance |
| Timeline |
| Voya High Yield |
| Nationwide Growth |
Voya High and Nationwide Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya High and Nationwide Growth
The main advantage of trading using opposite Voya High and Nationwide Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya High position performs unexpectedly, Nationwide Growth 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 Nationwide Growth will offset losses from the drop in Nationwide Growth's long position.| Voya High vs. Nationwide Growth Fund | Voya High vs. L Abbett Growth | Voya High vs. Artisan Small Cap | Voya High vs. Small Midcap Dividend Income |
| Nationwide Growth vs. Aquagold International | Nationwide Growth vs. Morningstar Unconstrained Allocation | Nationwide Growth vs. Thrivent High Yield | Nationwide Growth vs. Via Renewables |
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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