Correlation Between AG Mortgage and Voya Real
Can any of the company-specific risk be diversified away by investing in both AG Mortgage and Voya Real 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 AG Mortgage and Voya Real into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AG Mortgage Investment and Voya Real Estate, you can compare the effects of market volatilities on AG Mortgage and Voya Real 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 AG Mortgage with a short position of Voya Real. Check out your portfolio center. Please also check ongoing floating volatility patterns of AG Mortgage and Voya Real.
Diversification Opportunities for AG Mortgage and Voya Real
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MITT-PC and Voya is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding AG Mortgage Investment and Voya Real Estate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Real Estate and AG Mortgage 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 AG Mortgage Investment are associated (or correlated) with Voya Real. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Real Estate has no effect on the direction of AG Mortgage i.e., AG Mortgage and Voya Real go up and down completely randomly.
Pair Corralation between AG Mortgage and Voya Real
Assuming the 90 days trading horizon AG Mortgage Investment is expected to under-perform the Voya Real. But the preferred stock apears to be less risky and, when comparing its historical volatility, AG Mortgage Investment is 1.91 times less risky than Voya Real. The preferred stock trades about -0.09 of its potential returns per unit of risk. The Voya Real Estate is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 1,103 in Voya Real Estate on September 1, 2024 and sell it today you would earn a total of 34.00 from holding Voya Real Estate or generate 3.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
AG Mortgage Investment vs. Voya Real Estate
Performance |
| Timeline |
| AG Mortgage Investment |
| Voya Real Estate |
AG Mortgage and Voya Real Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AG Mortgage and Voya Real
The main advantage of trading using opposite AG Mortgage and Voya Real positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AG Mortgage position performs unexpectedly, Voya Real 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 Real will offset losses from the drop in Voya Real's long position.| AG Mortgage vs. ACRES Commercial Realty | AG Mortgage vs. Chimera Investment | AG Mortgage vs. Cherry Hill Mortgage |
| Voya Real vs. Realty Income | Voya Real vs. Dynex Capital | Voya Real vs. First Industrial Realty | Voya Real vs. Healthcare Realty Trust |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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