Correlation Between Voya Index and Upright Assets
Can any of the company-specific risk be diversified away by investing in both Voya Index and Upright Assets 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 Upright Assets 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 Upright Assets Allocation, you can compare the effects of market volatilities on Voya Index and Upright Assets 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 Upright Assets. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Index and Upright Assets.
Diversification Opportunities for Voya Index and Upright Assets
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Voya and Upright is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Voya Index Plus and Upright Assets Allocation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Upright Assets Allocation 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 Upright Assets. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Upright Assets Allocation has no effect on the direction of Voya Index i.e., Voya Index and Upright Assets go up and down completely randomly.
Pair Corralation between Voya Index and Upright Assets
Assuming the 90 days horizon Voya Index is expected to generate 12.11 times less return on investment than Upright Assets. But when comparing it to its historical volatility, Voya Index Plus is 1.71 times less risky than Upright Assets. It trades about 0.04 of its potential returns per unit of risk. Upright Assets Allocation is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 1,385 in Upright Assets Allocation on September 14, 2024 and sell it today you would earn a total of 142.00 from holding Upright Assets Allocation or generate 10.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Voya Index Plus vs. Upright Assets Allocation
Performance |
| Timeline |
| Voya Index Plus |
| Upright Assets Allocation |
Voya Index and Upright Assets Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya Index and Upright Assets
The main advantage of trading using opposite Voya Index and Upright Assets positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Index position performs unexpectedly, Upright Assets 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 Upright Assets will offset losses from the drop in Upright Assets' long position.| Voya Index vs. Red Oak Technology | Voya Index vs. Science Technology Fund | Voya Index vs. Hennessy Technology Fund | Voya Index vs. Invesco Technology Fund |
| Upright Assets vs. Fidelity Real Estate | Upright Assets vs. Commonwealth Real Estate | Upright Assets vs. Nexpoint Real Estate | Upright Assets vs. Forum Real Estate |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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