Correlation Between City National and Voya High
Can any of the company-specific risk be diversified away by investing in both City National and Voya High 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 City National and Voya High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between City National Rochdale and Voya High Yield, you can compare the effects of market volatilities on City National and Voya High 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 City National with a short position of Voya High. Check out your portfolio center. Please also check ongoing floating volatility patterns of City National and Voya High.
Diversification Opportunities for City National and Voya High
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between City and Voya is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding City National Rochdale and Voya High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya High Yield and City National 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 City National Rochdale are associated (or correlated) with Voya High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya High Yield has no effect on the direction of City National i.e., City National and Voya High go up and down completely randomly.
Pair Corralation between City National and Voya High
Assuming the 90 days horizon City National Rochdale is expected to generate 0.45 times more return on investment than Voya High. However, City National Rochdale is 2.23 times less risky than Voya High. It trades about 0.2 of its potential returns per unit of risk. Voya High Yield is currently generating about 0.06 per unit of risk. If you would invest 1,932 in City National Rochdale on November 1, 2024 and sell it today you would earn a total of 27.00 from holding City National Rochdale or generate 1.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
City National Rochdale vs. Voya High Yield
Performance |
| Timeline |
| City National Rochdale |
| Voya High Yield |
City National and Voya High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with City National and Voya High
The main advantage of trading using opposite City National and Voya High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if City National position performs unexpectedly, Voya High 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 High will offset losses from the drop in Voya High's long position.| City National vs. Federated Government Ultrashort | City National vs. Dreyfus Government Cash | City National vs. Voya Government Money | City National vs. Schwab Government Money |
| Voya High vs. Applied Finance Explorer | Voya High vs. Heartland Value Plus | Voya High vs. Mutual Of America | Voya High vs. Queens Road Small |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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