Correlation Between Multi-manager High and Voya Retirement
Can any of the company-specific risk be diversified away by investing in both Multi-manager High and Voya Retirement 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 Multi-manager High and Voya Retirement into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Multi Manager High Yield and Voya Retirement Growth, you can compare the effects of market volatilities on Multi-manager High and Voya Retirement 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 Multi-manager High with a short position of Voya Retirement. Check out your portfolio center. Please also check ongoing floating volatility patterns of Multi-manager High and Voya Retirement.
Diversification Opportunities for Multi-manager High and Voya Retirement
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Multi-manager and Voya is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Multi Manager High Yield and Voya Retirement Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Retirement Growth and Multi-manager High 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 Multi Manager High Yield are associated (or correlated) with Voya Retirement. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Retirement Growth has no effect on the direction of Multi-manager High i.e., Multi-manager High and Voya Retirement go up and down completely randomly.
Pair Corralation between Multi-manager High and Voya Retirement
Assuming the 90 days horizon Multi-manager High is expected to generate 1.95 times less return on investment than Voya Retirement. But when comparing it to its historical volatility, Multi Manager High Yield is 5.09 times less risky than Voya Retirement. It trades about 0.34 of its potential returns per unit of risk. Voya Retirement Growth is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 1,203 in Voya Retirement Growth on October 20, 2024 and sell it today you would earn a total of 22.00 from holding Voya Retirement Growth or generate 1.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Multi Manager High Yield vs. Voya Retirement Growth
Performance |
| Timeline |
| Multi Manager High |
| Voya Retirement Growth |
Multi-manager High and Voya Retirement Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Multi-manager High and Voya Retirement
The main advantage of trading using opposite Multi-manager High and Voya Retirement positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Multi-manager High position performs unexpectedly, Voya Retirement 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 Retirement will offset losses from the drop in Voya Retirement's long position.| Multi-manager High vs. Highland Longshort Healthcare | Multi-manager High vs. Delaware Healthcare Fund | Multi-manager High vs. Fidelity Advisor Health | Multi-manager High vs. Deutsche Health And |
| Voya Retirement vs. Ab High Income | Voya Retirement vs. Lord Abbett Short | Voya Retirement vs. Millerhoward High Income | Voya Retirement vs. Multi Manager High Yield |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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