Correlation Between Voya Retirement and Goldman Sachs
Can any of the company-specific risk be diversified away by investing in both Voya Retirement and Goldman Sachs 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 Retirement and Goldman Sachs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Voya Retirement Servative and Goldman Sachs High, you can compare the effects of market volatilities on Voya Retirement and Goldman Sachs 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 Retirement with a short position of Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Retirement and Goldman Sachs.
Diversification Opportunities for Voya Retirement and Goldman Sachs
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Voya and Goldman is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Voya Retirement Servative and Goldman Sachs High in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs High and Voya Retirement 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 Retirement Servative are associated (or correlated) with Goldman Sachs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goldman Sachs High has no effect on the direction of Voya Retirement i.e., Voya Retirement and Goldman Sachs go up and down completely randomly.
Pair Corralation between Voya Retirement and Goldman Sachs
Assuming the 90 days horizon Voya Retirement Servative is expected to generate 1.24 times more return on investment than Goldman Sachs. However, Voya Retirement is 1.24 times more volatile than Goldman Sachs High. It trades about 0.18 of its potential returns per unit of risk. Goldman Sachs High is currently generating about 0.19 per unit of risk. If you would invest 814.00 in Voya Retirement Servative on December 2, 2024 and sell it today you would earn a total of 9.00 from holding Voya Retirement Servative or generate 1.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Voya Retirement Servative vs. Goldman Sachs High
Performance |
| Timeline |
| Voya Retirement Servative |
| Goldman Sachs High |
Voya Retirement and Goldman Sachs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya Retirement and Goldman Sachs
The main advantage of trading using opposite Voya Retirement and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Retirement position performs unexpectedly, Goldman Sachs 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 Goldman Sachs will offset losses from the drop in Goldman Sachs' long position.| Voya Retirement vs. Voya Investors Trust | ||
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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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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