Correlation Between Voya Index and Lord Abbett
Can any of the company-specific risk be diversified away by investing in both Voya Index and Lord Abbett 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 Lord Abbett into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Voya Index Solution and Lord Abbett Convertible, you can compare the effects of market volatilities on Voya Index and Lord Abbett 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 Lord Abbett. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Index and Lord Abbett.
Diversification Opportunities for Voya Index and Lord Abbett
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Voya and Lord is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Voya Index Solution and Lord Abbett Convertible in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lord Abbett Convertible 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 Solution are associated (or correlated) with Lord Abbett. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lord Abbett Convertible has no effect on the direction of Voya Index i.e., Voya Index and Lord Abbett go up and down completely randomly.
Pair Corralation between Voya Index and Lord Abbett
Assuming the 90 days horizon Voya Index is expected to generate 1.25 times less return on investment than Lord Abbett. But when comparing it to its historical volatility, Voya Index Solution is 1.44 times less risky than Lord Abbett. It trades about 0.21 of its potential returns per unit of risk. Lord Abbett Convertible is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 1,455 in Lord Abbett Convertible on September 13, 2024 and sell it today you would earn a total of 31.00 from holding Lord Abbett Convertible or generate 2.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Voya Index Solution vs. Lord Abbett Convertible
Performance |
| Timeline |
| Voya Index Solution |
| Lord Abbett Convertible |
Voya Index and Lord Abbett Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya Index and Lord Abbett
The main advantage of trading using opposite Voya Index and Lord Abbett positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Index position performs unexpectedly, Lord Abbett 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 Lord Abbett will offset losses from the drop in Lord Abbett's long position.| Voya Index vs. Voya Bond Index | Voya Index vs. Voya Bond Index | Voya Index vs. Voya Limited Maturity | Voya Index vs. Voya Limited Maturity |
| Lord Abbett vs. Voya High Yield | Lord Abbett vs. Guggenheim High Yield | Lord Abbett vs. T Rowe Price | Lord Abbett vs. Blackrock High Yield |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios |