Correlation Between Arrow Managed and Voya Index
Can any of the company-specific risk be diversified away by investing in both Arrow Managed and Voya Index 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 Arrow Managed and Voya Index into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Arrow Managed Futures and Voya Index Plus, you can compare the effects of market volatilities on Arrow Managed and Voya Index 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 Arrow Managed with a short position of Voya Index. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arrow Managed and Voya Index.
Diversification Opportunities for Arrow Managed and Voya Index
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Arrow and Voya is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Arrow Managed Futures and Voya Index Plus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Index Plus and Arrow Managed 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 Arrow Managed Futures are associated (or correlated) with Voya Index. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Index Plus has no effect on the direction of Arrow Managed i.e., Arrow Managed and Voya Index go up and down completely randomly.
Pair Corralation between Arrow Managed and Voya Index
Assuming the 90 days horizon Arrow Managed is expected to generate 3.5 times less return on investment than Voya Index. In addition to that, Arrow Managed is 1.25 times more volatile than Voya Index Plus. It trades about 0.02 of its total potential returns per unit of risk. Voya Index Plus is currently generating about 0.1 per unit of volatility. If you would invest 1,723 in Voya Index Plus on September 4, 2024 and sell it today you would earn a total of 498.00 from holding Voya Index Plus or generate 28.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Arrow Managed Futures vs. Voya Index Plus
Performance |
| Timeline |
| Arrow Managed Futures |
| Voya Index Plus |
Arrow Managed and Voya Index Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Arrow Managed and Voya Index
The main advantage of trading using opposite Arrow Managed and Voya Index positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arrow Managed position performs unexpectedly, Voya Index 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 Voya Index will offset losses from the drop in Voya Index's long position.| Arrow Managed vs. Growth Strategy Fund | Arrow Managed vs. Artisan Thematic Fund | Arrow Managed vs. Nationwide Global Equity | Arrow Managed vs. Volumetric Fund Volumetric |
| Voya Index vs. Fa 529 Aggressive | Voya Index vs. Arrow Managed Futures | Voya Index vs. Sei Daily Income | Voya Index vs. Leggmason Partners Institutional |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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