Correlation Between Voya Index and Vanguard Information
Can any of the company-specific risk be diversified away by investing in both Voya Index and Vanguard Information 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 Vanguard Information 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 Vanguard Information Technology, you can compare the effects of market volatilities on Voya Index and Vanguard Information 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 Vanguard Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Index and Vanguard Information.
Diversification Opportunities for Voya Index and Vanguard Information
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Voya and VANGUARD is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Voya Index Plus and Vanguard Information Technolog in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Information 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 Vanguard Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard Information has no effect on the direction of Voya Index i.e., Voya Index and Vanguard Information go up and down completely randomly.
Pair Corralation between Voya Index and Vanguard Information
Assuming the 90 days horizon Voya Index is expected to generate 13.15 times less return on investment than Vanguard Information. But when comparing it to its historical volatility, Voya Index Plus is 1.13 times less risky than Vanguard Information. It trades about 0.0 of its potential returns per unit of risk. Vanguard Information Technology is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 19,029 in Vanguard Information Technology on January 11, 2025 and sell it today you would earn a total of 7,623 from holding Vanguard Information Technology or generate 40.06% 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. Vanguard Information Technolog
Performance |
| Timeline |
| Voya Index Plus |
| Vanguard Information |
Voya Index and Vanguard Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya Index and Vanguard Information
The main advantage of trading using opposite Voya Index and Vanguard Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Index position performs unexpectedly, Vanguard Information 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 Vanguard Information will offset losses from the drop in Vanguard Information's long position.| Voya Index vs. Fidelity Advisor Gold | Voya Index vs. Franklin Gold Precious | Voya Index vs. First Eagle Gold | Voya Index vs. Invesco Gold Special |
| Vanguard Information vs. Vanguard Health Care | Vanguard Information vs. Vanguard Financials Index | Vanguard Information vs. Vanguard Sumer Discretionary | Vanguard Information vs. Vanguard Utilities Index |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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