Correlation Between Total Return and Voya Intermediate
Can any of the company-specific risk be diversified away by investing in both Total Return and Voya Intermediate 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 Total Return and Voya Intermediate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Total Return Fund and Voya Intermediate Bond, you can compare the effects of market volatilities on Total Return and Voya Intermediate 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 Total Return with a short position of Voya Intermediate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Total Return and Voya Intermediate.
Diversification Opportunities for Total Return and Voya Intermediate
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Total and Voya is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Total Return Fund and Voya Intermediate Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Intermediate Bond and Total Return 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 Total Return Fund are associated (or correlated) with Voya Intermediate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Intermediate Bond has no effect on the direction of Total Return i.e., Total Return and Voya Intermediate go up and down completely randomly.
Pair Corralation between Total Return and Voya Intermediate
Assuming the 90 days horizon Total Return Fund is expected to generate 1.01 times more return on investment than Voya Intermediate. However, Total Return is 1.01 times more volatile than Voya Intermediate Bond. It trades about 0.11 of its potential returns per unit of risk. Voya Intermediate Bond is currently generating about 0.11 per unit of risk. If you would invest 856.00 in Total Return Fund on September 3, 2024 and sell it today you would earn a total of 7.00 from holding Total Return Fund or generate 0.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Total Return Fund vs. Voya Intermediate Bond
Performance |
| Timeline |
| Total Return |
| Voya Intermediate Bond |
Total Return and Voya Intermediate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Total Return and Voya Intermediate
The main advantage of trading using opposite Total Return and Voya Intermediate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Total Return position performs unexpectedly, Voya Intermediate 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 Intermediate will offset losses from the drop in Voya Intermediate's long position.| Total Return vs. Metropolitan West Total | Total Return vs. Metropolitan West Total | Total Return vs. Pimco Total Return | Total Return vs. Total Return Fund |
| Voya Intermediate vs. Metropolitan West Total | Voya Intermediate vs. Metropolitan West Total | Voya Intermediate vs. Pimco Total Return | Voya Intermediate vs. Total Return Fund |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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