Correlation Between Voya High and Aquila Three
Can any of the company-specific risk be diversified away by investing in both Voya High and Aquila Three 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 Aquila Three 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 Aquila Three Peaks, you can compare the effects of market volatilities on Voya High and Aquila Three 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 Aquila Three. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya High and Aquila Three.
Diversification Opportunities for Voya High and Aquila Three
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Voya and Aquila is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Voya High Yield and Aquila Three Peaks in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aquila Three Peaks 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 Aquila Three. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aquila Three Peaks has no effect on the direction of Voya High i.e., Voya High and Aquila Three go up and down completely randomly.
Pair Corralation between Voya High and Aquila Three
Assuming the 90 days horizon Voya High is expected to generate 1.38 times less return on investment than Aquila Three. But when comparing it to its historical volatility, Voya High Yield is 3.4 times less risky than Aquila Three. It trades about 0.12 of its potential returns per unit of risk. Aquila Three Peaks is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 2,375 in Aquila Three Peaks on November 2, 2024 and sell it today you would earn a total of 510.00 from holding Aquila Three Peaks or generate 21.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 91.3% |
| Values | Daily Returns |
Voya High Yield vs. Aquila Three Peaks
Performance |
| Timeline |
| Voya High Yield |
| Aquila Three Peaks |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Voya High and Aquila Three Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya High and Aquila Three
The main advantage of trading using opposite Voya High and Aquila Three positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya High position performs unexpectedly, Aquila Three 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 Aquila Three will offset losses from the drop in Aquila Three's long position.| Voya High vs. Ultra Short Fixed Income | Voya High vs. Angel Oak Ultrashort | Voya High vs. Fidelity Flex Servative | Voya High vs. Virtus Multi Sector Short |
| Aquila Three vs. Lord Abbett Diversified | Aquila Three vs. Delaware Limited Term Diversified | Aquila Three vs. Jhancock Diversified Macro | Aquila Three vs. Allianzgi Diversified Income |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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