Correlation Between Voya High and Federated Hermes
Can any of the company-specific risk be diversified away by investing in both Voya High and Federated Hermes 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 Federated Hermes 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 Federated Hermes Emerging, you can compare the effects of market volatilities on Voya High and Federated Hermes 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 Federated Hermes. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya High and Federated Hermes.
Diversification Opportunities for Voya High and Federated Hermes
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Voya and Federated is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Voya High Yield and Federated Hermes Emerging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Federated Hermes Emerging 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 Federated Hermes. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Federated Hermes Emerging has no effect on the direction of Voya High i.e., Voya High and Federated Hermes go up and down completely randomly.
Pair Corralation between Voya High and Federated Hermes
Assuming the 90 days horizon Voya High Yield is expected to generate 0.17 times more return on investment than Federated Hermes. However, Voya High Yield is 5.88 times less risky than Federated Hermes. It trades about 0.17 of its potential returns per unit of risk. Federated Hermes Emerging is currently generating about 0.01 per unit of risk. If you would invest 872.00 in Voya High Yield on November 4, 2024 and sell it today you would earn a total of 5.00 from holding Voya High Yield or generate 0.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.0% |
| Values | Daily Returns |
Voya High Yield vs. Federated Hermes Emerging
Performance |
| Timeline |
| Voya High Yield |
| Federated Hermes Emerging |
Voya High and Federated Hermes Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya High and Federated Hermes
The main advantage of trading using opposite Voya High and Federated Hermes positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya High position performs unexpectedly, Federated Hermes 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 Federated Hermes will offset losses from the drop in Federated Hermes' long position.| Voya High vs. Transamerica Intermediate Muni | Voya High vs. Morningstar Municipal Bond | Voya High vs. Baird Quality Intermediate | Voya High vs. Jpmorgan Ultra Short Municipal |
| Federated Hermes vs. Investec Emerging Markets | Federated Hermes vs. Dodge Cox Emerging | Federated Hermes vs. Federated Emerging Market | Federated Hermes vs. Nasdaq 100 2x Strategy |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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