Correlation Between Voya Solution and Catalyst/smh High
Can any of the company-specific risk be diversified away by investing in both Voya Solution and Catalyst/smh High 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 Solution and Catalyst/smh High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Voya Solution 2030 and Catalystsmh High Income, you can compare the effects of market volatilities on Voya Solution and Catalyst/smh High 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 Solution with a short position of Catalyst/smh High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Solution and Catalyst/smh High.
Diversification Opportunities for Voya Solution and Catalyst/smh High
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Voya and Catalyst/smh is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Voya Solution 2030 and Catalystsmh High Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Catalystsmh High Income and Voya Solution 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 Solution 2030 are associated (or correlated) with Catalyst/smh High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Catalystsmh High Income has no effect on the direction of Voya Solution i.e., Voya Solution and Catalyst/smh High go up and down completely randomly.
Pair Corralation between Voya Solution and Catalyst/smh High
Assuming the 90 days horizon Voya Solution 2030 is expected to generate 1.55 times more return on investment than Catalyst/smh High. However, Voya Solution is 1.55 times more volatile than Catalystsmh High Income. It trades about 0.08 of its potential returns per unit of risk. Catalystsmh High Income is currently generating about 0.11 per unit of risk. If you would invest 1,208 in Voya Solution 2030 on October 9, 2024 and sell it today you would earn a total of 277.00 from holding Voya Solution 2030 or generate 22.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Voya Solution 2030 vs. Catalystsmh High Income
Performance |
| Timeline |
| Voya Solution 2030 |
| Catalystsmh High Income |
Voya Solution and Catalyst/smh High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya Solution and Catalyst/smh High
The main advantage of trading using opposite Voya Solution and Catalyst/smh High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Solution position performs unexpectedly, Catalyst/smh High 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 Catalyst/smh High will offset losses from the drop in Catalyst/smh High's long position.| Voya Solution vs. Tiaa Cref Lifestyle Moderate | Voya Solution vs. Voya Target Retirement | Voya Solution vs. Qs Moderate Growth | Voya Solution vs. Tiaa Cref Lifestyle Moderate |
| Catalyst/smh High vs. Ab Small Cap | Catalyst/smh High vs. Tax Managed Large Cap | Catalyst/smh High vs. Rationalpier 88 Convertible | Catalyst/smh High vs. Issachar Fund Class |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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