Correlation Between Balanced Strategy and Voya Target
Can any of the company-specific risk be diversified away by investing in both Balanced Strategy and Voya Target 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 Balanced Strategy and Voya Target into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Balanced Strategy Fund and Voya Target Retirement, you can compare the effects of market volatilities on Balanced Strategy and Voya Target 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 Balanced Strategy with a short position of Voya Target. Check out your portfolio center. Please also check ongoing floating volatility patterns of Balanced Strategy and Voya Target.
Diversification Opportunities for Balanced Strategy and Voya Target
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Balanced and Voya is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Balanced Strategy Fund and Voya Target Retirement in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Target Retirement and Balanced Strategy 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 Balanced Strategy Fund are associated (or correlated) with Voya Target. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Target Retirement has no effect on the direction of Balanced Strategy i.e., Balanced Strategy and Voya Target go up and down completely randomly.
Pair Corralation between Balanced Strategy and Voya Target
Assuming the 90 days horizon Balanced Strategy Fund is expected to generate 0.87 times more return on investment than Voya Target. However, Balanced Strategy Fund is 1.15 times less risky than Voya Target. It trades about -0.23 of its potential returns per unit of risk. Voya Target Retirement is currently generating about -0.29 per unit of risk. If you would invest 1,052 in Balanced Strategy Fund on October 9, 2024 and sell it today you would lose (28.00) from holding Balanced Strategy Fund or give up 2.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Balanced Strategy Fund vs. Voya Target Retirement
Performance |
| Timeline |
| Balanced Strategy |
| Voya Target Retirement |
Balanced Strategy and Voya Target Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Balanced Strategy and Voya Target
The main advantage of trading using opposite Balanced Strategy and Voya Target positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Balanced Strategy position performs unexpectedly, Voya Target 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 Target will offset losses from the drop in Voya Target's long position.| Balanced Strategy vs. Catalystmillburn Hedge Strategy | Balanced Strategy vs. Black Oak Emerging | Balanced Strategy vs. Western Assets Emerging | Balanced Strategy vs. Nasdaq 100 2x Strategy |
| Voya Target vs. The Gold Bullion | Voya Target vs. James Balanced Golden | Voya Target vs. Deutsche Gold Precious | Voya Target vs. Europac Gold 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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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