Correlation Between Commodities Strategy and Voya International
Can any of the company-specific risk be diversified away by investing in both Commodities Strategy and Voya International 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 Commodities Strategy and Voya International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Commodities Strategy Fund and Voya International Index, you can compare the effects of market volatilities on Commodities Strategy and Voya International 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 Commodities Strategy with a short position of Voya International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Commodities Strategy and Voya International.
Diversification Opportunities for Commodities Strategy and Voya International
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Commodities and Voya is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Commodities Strategy Fund and Voya International Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya International Index and Commodities 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 Commodities Strategy Fund are associated (or correlated) with Voya International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya International Index has no effect on the direction of Commodities Strategy i.e., Commodities Strategy and Voya International go up and down completely randomly.
Pair Corralation between Commodities Strategy and Voya International
Assuming the 90 days horizon Commodities Strategy Fund is expected to generate 1.59 times more return on investment than Voya International. However, Commodities Strategy is 1.59 times more volatile than Voya International Index. It trades about 0.02 of its potential returns per unit of risk. Voya International Index is currently generating about -0.24 per unit of risk. If you would invest 2,907 in Commodities Strategy Fund on August 29, 2024 and sell it today you would earn a total of 24.00 from holding Commodities Strategy Fund or generate 0.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Commodities Strategy Fund vs. Voya International Index
Performance |
| Timeline |
| Commodities Strategy |
| Voya International Index |
Commodities Strategy and Voya International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Commodities Strategy and Voya International
The main advantage of trading using opposite Commodities Strategy and Voya International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Commodities Strategy position performs unexpectedly, Voya International 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 International will offset losses from the drop in Voya International's long position.| Commodities Strategy vs. Pimco Moditiesplus Strategy | Commodities Strategy vs. HUMANA INC | Commodities Strategy vs. Aquagold International | Commodities Strategy vs. Barloworld Ltd ADR |
| Voya International vs. Artisan Emerging Markets | Voya International vs. Barings Emerging Markets | Voya International vs. Shelton Emerging Markets | Voya International vs. Commodities Strategy 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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