Correlation Between Smallcap Growth and Voya Multi
Can any of the company-specific risk be diversified away by investing in both Smallcap Growth and Voya Multi 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 Smallcap Growth and Voya Multi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Smallcap Growth Fund and Voya Multi Manager International, you can compare the effects of market volatilities on Smallcap Growth and Voya Multi 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 Smallcap Growth with a short position of Voya Multi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Smallcap Growth and Voya Multi.
Diversification Opportunities for Smallcap Growth and Voya Multi
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Smallcap and Voya is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Smallcap Growth Fund and Voya Multi Manager Internation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Multi Manager and Smallcap 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 Smallcap Growth Fund are associated (or correlated) with Voya Multi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Multi Manager has no effect on the direction of Smallcap Growth i.e., Smallcap Growth and Voya Multi go up and down completely randomly.
Pair Corralation between Smallcap Growth and Voya Multi
Assuming the 90 days horizon Smallcap Growth is expected to generate 1.2 times less return on investment than Voya Multi. In addition to that, Smallcap Growth is 2.32 times more volatile than Voya Multi Manager International. It trades about 0.06 of its total potential returns per unit of risk. Voya Multi Manager International is currently generating about 0.18 per unit of volatility. If you would invest 935.00 in Voya Multi Manager International on September 14, 2024 and sell it today you would earn a total of 46.00 from holding Voya Multi Manager International or generate 4.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 10.73% |
| Values | Daily Returns |
Smallcap Growth Fund vs. Voya Multi Manager Internation
Performance |
| Timeline |
| Smallcap Growth |
| Voya Multi Manager |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Smallcap Growth and Voya Multi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Smallcap Growth and Voya Multi
The main advantage of trading using opposite Smallcap Growth and Voya Multi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Smallcap Growth position performs unexpectedly, Voya Multi 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 Multi will offset losses from the drop in Voya Multi's long position.| Smallcap Growth vs. Eip Growth And | Smallcap Growth vs. Franklin Growth Opportunities | Smallcap Growth vs. Rational Defensive Growth | Smallcap Growth vs. Praxis Growth Index |
| Voya Multi vs. Mutual Of America | Voya Multi vs. Vy Columbia Small | Voya Multi vs. Smallcap Growth Fund | Voya Multi vs. Ab Small Cap |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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