Correlation Between Voya Government and Small Cap
Can any of the company-specific risk be diversified away by investing in both Voya Government and Small Cap 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 Small Cap 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 Small Cap Equity, you can compare the effects of market volatilities on Voya Government and Small Cap 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 Small Cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Government and Small Cap.
Diversification Opportunities for Voya Government and Small Cap
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Voya and Small is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Voya Government Money and Small Cap Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Small Cap Equity 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 Small Cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Small Cap Equity has no effect on the direction of Voya Government i.e., Voya Government and Small Cap go up and down completely randomly.
Pair Corralation between Voya Government and Small Cap
If you would invest 100.00 in Voya Government Money on October 16, 2024 and sell it today you would earn a total of 0.00 from holding Voya Government Money or generate 0.0% 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. Small Cap Equity
Performance |
| Timeline |
| Voya Government Money |
| Small Cap Equity |
Voya Government and Small Cap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya Government and Small Cap
The main advantage of trading using opposite Voya Government and Small Cap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Government position performs unexpectedly, Small Cap 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 Small Cap will offset losses from the drop in Small Cap's long position.| Voya Government vs. Pimco Diversified Income | Voya Government vs. Wells Fargo Diversified | Voya Government vs. Lord Abbett Diversified | Voya Government vs. Fulcrum Diversified Absolute |
| Small Cap vs. James Balanced Golden | Small Cap vs. Invesco Gold Special | Small Cap vs. International Investors Gold | Small Cap vs. Franklin Gold Precious |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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