Correlation Between Nationwide Growth and Voya High
Can any of the company-specific risk be diversified away by investing in both Nationwide Growth and Voya High 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 Nationwide Growth and Voya High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nationwide Growth Fund and Voya High Yield, you can compare the effects of market volatilities on Nationwide Growth and Voya High 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 Nationwide Growth with a short position of Voya High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nationwide Growth and Voya High.
Diversification Opportunities for Nationwide Growth and Voya High
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between NATIONWIDE and Voya is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Nationwide Growth Fund and Voya High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya High Yield and Nationwide Growth 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 Nationwide Growth Fund are associated (or correlated) with Voya High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya High Yield has no effect on the direction of Nationwide Growth i.e., Nationwide Growth and Voya High go up and down completely randomly.
Pair Corralation between Nationwide Growth and Voya High
Assuming the 90 days horizon Nationwide Growth Fund is expected to generate 3.52 times more return on investment than Voya High. However, Nationwide Growth is 3.52 times more volatile than Voya High Yield. It trades about 0.15 of its potential returns per unit of risk. Voya High Yield is currently generating about 0.18 per unit of risk. If you would invest 1,194 in Nationwide Growth Fund on September 2, 2024 and sell it today you would earn a total of 370.00 from holding Nationwide Growth Fund or generate 30.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nationwide Growth Fund vs. Voya High Yield
Performance |
| Timeline |
| Nationwide Growth |
| Voya High Yield |
Nationwide Growth and Voya High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nationwide Growth and Voya High
The main advantage of trading using opposite Nationwide Growth and Voya High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nationwide Growth position performs unexpectedly, Voya High 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 High will offset losses from the drop in Voya High's long position.| Nationwide Growth vs. Nationwide Mid Cap | Nationwide Growth vs. Nationwide Small Cap | Nationwide Growth vs. Nationwide International Index | Nationwide Growth vs. Nationwide Fund Institutional |
| Voya High vs. Voya Bond Index | Voya High vs. Voya Bond Index | Voya High vs. Voya Limited Maturity | Voya High 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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