Correlation Between Voya High and Baron Opportunity
Can any of the company-specific risk be diversified away by investing in both Voya High and Baron Opportunity 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 Baron Opportunity 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 Baron Opportunity Fund, you can compare the effects of market volatilities on Voya High and Baron Opportunity 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 Baron Opportunity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya High and Baron Opportunity.
Diversification Opportunities for Voya High and Baron Opportunity
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Voya and Baron is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Voya High Yield and Baron Opportunity Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baron Opportunity 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 Baron Opportunity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baron Opportunity has no effect on the direction of Voya High i.e., Voya High and Baron Opportunity go up and down completely randomly.
Pair Corralation between Voya High and Baron Opportunity
Assuming the 90 days horizon Voya High Yield is expected to under-perform the Baron Opportunity. But the mutual fund apears to be less risky and, when comparing its historical volatility, Voya High Yield is 11.88 times less risky than Baron Opportunity. The mutual fund trades about -0.37 of its potential returns per unit of risk. The Baron Opportunity Fund is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 5,329 in Baron Opportunity Fund on October 9, 2024 and sell it today you would lose (68.00) from holding Baron Opportunity Fund or give up 1.28% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Voya High Yield vs. Baron Opportunity Fund
Performance |
| Timeline |
| Voya High Yield |
| Baron Opportunity |
Voya High and Baron Opportunity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya High and Baron Opportunity
The main advantage of trading using opposite Voya High and Baron Opportunity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya High position performs unexpectedly, Baron Opportunity 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 Baron Opportunity will offset losses from the drop in Baron Opportunity's long position.| Voya High vs. Barings Global Floating | Voya High vs. Ms Global Fixed | Voya High vs. Qs Global Equity | Voya High vs. Asg Global Alternatives |
| Baron Opportunity vs. Simt High Yield | Baron Opportunity vs. Virtus High Yield | Baron Opportunity vs. Janus High Yield Fund | Baron Opportunity vs. T Rowe Price |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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