Correlation Between Multi-manager High and Voya High
Can any of the company-specific risk be diversified away by investing in both Multi-manager High 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 Multi-manager High and Voya High 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 High Yield, you can compare the effects of market volatilities on Multi-manager High 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 Multi-manager High with a short position of Voya High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Multi-manager High and Voya High.
Diversification Opportunities for Multi-manager High and Voya High
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Multi-manager and Voya is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Multi Manager High Yield 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 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 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 Multi-manager High i.e., Multi-manager High and Voya High go up and down completely randomly.
Pair Corralation between Multi-manager High and Voya High
Assuming the 90 days horizon Multi Manager High Yield is expected to generate 0.91 times more return on investment than Voya High. However, Multi Manager High Yield is 1.1 times less risky than Voya High. It trades about -0.11 of its potential returns per unit of risk. Voya High Yield is currently generating about -0.33 per unit of risk. If you would invest 844.00 in Multi Manager High Yield on October 12, 2024 and sell it today you would lose (3.00) from holding Multi Manager High Yield or give up 0.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Multi Manager High Yield vs. Voya High Yield
Performance |
| Timeline |
| Multi Manager High |
| Voya High Yield |
Multi-manager High and Voya High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Multi-manager High and Voya High
The main advantage of trading using opposite Multi-manager High and Voya High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Multi-manager High 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.| Multi-manager High vs. Legg Mason Global | Multi-manager High vs. Mirova Global Green | Multi-manager High vs. Alliancebernstein Global Highome | Multi-manager High vs. Artisan Global Opportunities |
| Voya High vs. Dreyfus High Yield | Voya High vs. Blackrock High Yield | Voya High vs. Jpmorgan High Yield | Voya High vs. Federated 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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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