Correlation Between Voya Global and Growth Fund
Can any of the company-specific risk be diversified away by investing in both Voya Global and Growth Fund 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 Growth Fund 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 Growth Fund Of, you can compare the effects of market volatilities on Voya Global and Growth Fund 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 Growth Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Global and Growth Fund.
Diversification Opportunities for Voya Global and Growth Fund
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Voya and Growth is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Voya Global Equity and Growth Fund Of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Growth Fund 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 Growth Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Growth Fund has no effect on the direction of Voya Global i.e., Voya Global and Growth Fund go up and down completely randomly.
Pair Corralation between Voya Global and Growth Fund
Assuming the 90 days horizon Voya Global is expected to generate 1.33 times less return on investment than Growth Fund. But when comparing it to its historical volatility, Voya Global Equity is 1.58 times less risky than Growth Fund. It trades about 0.42 of its potential returns per unit of risk. Growth Fund Of is currently generating about 0.35 of returns per unit of risk over similar time horizon. If you would invest 6,944 in Growth Fund Of on September 1, 2024 and sell it today you would earn a total of 462.00 from holding Growth Fund Of or generate 6.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Voya Global Equity vs. Growth Fund Of
Performance |
| Timeline |
| Voya Global Equity |
| Growth Fund |
Voya Global and Growth Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya Global and Growth Fund
The main advantage of trading using opposite Voya Global and Growth Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Global position performs unexpectedly, Growth Fund 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 Growth Fund will offset losses from the drop in Growth Fund'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 |
| Growth Fund vs. Europacific Growth Fund | Growth Fund vs. Washington Mutual Investors | Growth Fund vs. Capital World Growth | Growth Fund vs. American Balanced Fund |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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