Correlation Between Voya Global and Voya Large-cap
Can any of the company-specific risk be diversified away by investing in both Voya Global and Voya Large-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 Global and Voya Large-cap into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Voya Global Equity and Voya Large Cap Growth, you can compare the effects of market volatilities on Voya Global and Voya Large-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 Global with a short position of Voya Large-cap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Global and Voya Large-cap.
Diversification Opportunities for Voya Global and Voya Large-cap
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Voya and VOYA is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Voya Global Equity and Voya Large Cap Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Large Cap and Voya Global 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 Global Equity are associated (or correlated) with Voya Large-cap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Large Cap has no effect on the direction of Voya Global i.e., Voya Global and Voya Large-cap go up and down completely randomly.
Pair Corralation between Voya Global and Voya Large-cap
Assuming the 90 days horizon Voya Global is expected to generate 1.54 times less return on investment than Voya Large-cap. But when comparing it to its historical volatility, Voya Global Equity is 1.98 times less risky than Voya Large-cap. It trades about 0.23 of its potential returns per unit of risk. Voya Large Cap Growth is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 5,908 in Voya Large Cap Growth on August 25, 2024 and sell it today you would earn a total of 274.00 from holding Voya Large Cap Growth or generate 4.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Voya Global Equity vs. Voya Large Cap Growth
Performance |
| Timeline |
| Voya Global Equity |
| Voya Large Cap |
Voya Global and Voya Large-cap Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya Global and Voya Large-cap
The main advantage of trading using opposite Voya Global and Voya Large-cap positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Global position performs unexpectedly, Voya Large-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 Voya Large-cap will offset losses from the drop in Voya Large-cap's long position.| Voya Global vs. Voya Bond Index | Voya Global vs. Voya Bond Index | Voya Global vs. Voya Limited Maturity | Voya Global vs. Voya Limited Maturity |
| Voya Large-cap vs. Voya Bond Index | Voya Large-cap vs. Voya Bond Index | Voya Large-cap vs. Voya Limited Maturity | Voya Large-cap vs. Voya Limited Maturity |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
Other Complementary Tools
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Positions Ratings Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance |