Correlation Between NYSE Composite and Voya Bond
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Voya Bond 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 NYSE Composite and Voya Bond into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Voya Bond Index, you can compare the effects of market volatilities on NYSE Composite and Voya Bond 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 NYSE Composite with a short position of Voya Bond. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Voya Bond.
Diversification Opportunities for NYSE Composite and Voya Bond
-0.62 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between NYSE and Voya is -0.62. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Voya Bond Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Bond Index and NYSE Composite 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 NYSE Composite are associated (or correlated) with Voya Bond. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Bond Index has no effect on the direction of NYSE Composite i.e., NYSE Composite and Voya Bond go up and down completely randomly.
Pair Corralation between NYSE Composite and Voya Bond
Assuming the 90 days trading horizon NYSE Composite is expected to generate 2.08 times more return on investment than Voya Bond. However, NYSE Composite is 2.08 times more volatile than Voya Bond Index. It trades about 0.15 of its potential returns per unit of risk. Voya Bond Index is currently generating about -0.11 per unit of risk. If you would invest 1,906,443 in NYSE Composite on August 28, 2024 and sell it today you would earn a total of 115,593 from holding NYSE Composite or generate 6.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Voya Bond Index
Performance |
| Timeline |
NYSE Composite and Voya Bond Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Voya Bond Index
Pair trading matchups for Voya Bond
Pair Trading with NYSE Composite and Voya Bond
The main advantage of trading using opposite NYSE Composite and Voya Bond positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Voya Bond 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 Bond will offset losses from the drop in Voya Bond's long position.| NYSE Composite vs. Hooker Furniture | NYSE Composite vs. Hudson Pacific Properties | NYSE Composite vs. Canlan Ice Sports | NYSE Composite vs. Boston Properties |
| Voya Bond vs. Voya Limited Maturity | Voya Bond vs. Voya Limited Maturity | Voya Bond vs. Voya Limited Maturity | Voya Bond vs. Voya Emerging Markets |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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