Correlation Between Voya Index and Vy(r) Jpmorgan
Can any of the company-specific risk be diversified away by investing in both Voya Index and Vy(r) Jpmorgan 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 Index and Vy(r) Jpmorgan into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Voya Index Plus and Vy Jpmorgan Small, you can compare the effects of market volatilities on Voya Index and Vy(r) Jpmorgan 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 Index with a short position of Vy(r) Jpmorgan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Index and Vy(r) Jpmorgan.
Diversification Opportunities for Voya Index and Vy(r) Jpmorgan
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Voya and Vy(r) is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Voya Index Plus and Vy Jpmorgan Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vy Jpmorgan Small and Voya Index 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 Index Plus are associated (or correlated) with Vy(r) Jpmorgan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vy Jpmorgan Small has no effect on the direction of Voya Index i.e., Voya Index and Vy(r) Jpmorgan go up and down completely randomly.
Pair Corralation between Voya Index and Vy(r) Jpmorgan
Assuming the 90 days horizon Voya Index is expected to generate 1.68 times less return on investment than Vy(r) Jpmorgan. But when comparing it to its historical volatility, Voya Index Plus is 1.83 times less risky than Vy(r) Jpmorgan. It trades about 0.24 of its potential returns per unit of risk. Vy Jpmorgan Small is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 1,663 in Vy Jpmorgan Small on August 29, 2024 and sell it today you would earn a total of 125.00 from holding Vy Jpmorgan Small or generate 7.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Voya Index Plus vs. Vy Jpmorgan Small
Performance |
| Timeline |
| Voya Index Plus |
| Vy Jpmorgan Small |
Voya Index and Vy(r) Jpmorgan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya Index and Vy(r) Jpmorgan
The main advantage of trading using opposite Voya Index and Vy(r) Jpmorgan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Index position performs unexpectedly, Vy(r) Jpmorgan 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 Vy(r) Jpmorgan will offset losses from the drop in Vy(r) Jpmorgan's long position.| Voya Index vs. Tax Managed Mid Small | Voya Index vs. Champlain Small | Voya Index vs. Baird Smallmid Cap | Voya Index vs. Touchstone Small Cap |
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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 Transaction History module to view history of all your transactions and understand their impact on performance.
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