Correlation Between Voya Government and Intermediate Government
Can any of the company-specific risk be diversified away by investing in both Voya Government and Intermediate Government 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 Government and Intermediate Government into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Voya Government Money and Intermediate Government Bond, you can compare the effects of market volatilities on Voya Government and Intermediate Government 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 Government with a short position of Intermediate Government. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Government and Intermediate Government.
Diversification Opportunities for Voya Government and Intermediate Government
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Voya and Intermediate is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Voya Government Money and Intermediate Government Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Intermediate Government and Voya Government 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 Government Money are associated (or correlated) with Intermediate Government. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Intermediate Government has no effect on the direction of Voya Government i.e., Voya Government and Intermediate Government go up and down completely randomly.
Pair Corralation between Voya Government and Intermediate Government
Assuming the 90 days horizon Voya Government Money is expected to generate 125.0 times more return on investment than Intermediate Government. However, Voya Government is 125.0 times more volatile than Intermediate Government Bond. It trades about 0.04 of its potential returns per unit of risk. Intermediate Government Bond is currently generating about 0.1 per unit of risk. If you would invest 92.00 in Voya Government Money on October 9, 2024 and sell it today you would earn a total of 8.00 from holding Voya Government Money or generate 8.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Voya Government Money vs. Intermediate Government Bond
Performance |
| Timeline |
| Voya Government Money |
| Intermediate Government |
Voya Government and Intermediate Government Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya Government and Intermediate Government
The main advantage of trading using opposite Voya Government and Intermediate Government positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Government position performs unexpectedly, Intermediate Government 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 Intermediate Government will offset losses from the drop in Intermediate Government's long position.| Voya Government vs. Wealthbuilder Moderate Balanced | Voya Government vs. Franklin Lifesmart Retirement | Voya Government vs. Columbia Moderate Growth | Voya Government vs. Putnam Retirement Advantage |
| Intermediate Government vs. Aqr Large Cap | Intermediate Government vs. Rbb Fund Trust | Intermediate Government vs. Barings Global Floating | Intermediate Government vs. Transamerica Asset Allocation |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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