Correlation Between Federated Ohio and Voya Index
Can any of the company-specific risk be diversified away by investing in both Federated Ohio and Voya Index 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 Federated Ohio and Voya Index into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Ohio Municipal and Voya Index Solution, you can compare the effects of market volatilities on Federated Ohio and Voya Index 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 Federated Ohio with a short position of Voya Index. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Ohio and Voya Index.
Diversification Opportunities for Federated Ohio and Voya Index
-0.09 | Correlation Coefficient |
Good diversification
The 3 months correlation between FEDERATED and Voya is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding Federated Ohio Municipal and Voya Index Solution in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Index Solution and Federated Ohio 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 Federated Ohio Municipal are associated (or correlated) with Voya Index. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Index Solution has no effect on the direction of Federated Ohio i.e., Federated Ohio and Voya Index go up and down completely randomly.
Pair Corralation between Federated Ohio and Voya Index
Assuming the 90 days horizon Federated Ohio is expected to generate 1.87 times less return on investment than Voya Index. But when comparing it to its historical volatility, Federated Ohio Municipal is 2.13 times less risky than Voya Index. It trades about 0.16 of its potential returns per unit of risk. Voya Index Solution is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 1,579 in Voya Index Solution on August 31, 2024 and sell it today you would earn a total of 31.00 from holding Voya Index Solution or generate 1.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Federated Ohio Municipal vs. Voya Index Solution
Performance |
| Timeline |
| Federated Ohio Municipal |
| Voya Index Solution |
Federated Ohio and Voya Index Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Federated Ohio and Voya Index
The main advantage of trading using opposite Federated Ohio and Voya Index positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Ohio position performs unexpectedly, Voya Index 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 Index will offset losses from the drop in Voya Index's long position.| Federated Ohio vs. Vanguard Ohio Long Term | Federated Ohio vs. Franklin Ohio Tax Free | Federated Ohio vs. Fidelity Ohio Municipal | Federated Ohio vs. HUMANA INC |
| Voya Index vs. California High Yield Municipal | Voya Index vs. Blrc Sgy Mnp | Voya Index vs. Federated Ohio Municipal | Voya Index vs. Nuveen Minnesota Municipal |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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