Correlation Between Sprott Gold and Voya Index
Can any of the company-specific risk be diversified away by investing in both Sprott Gold and Voya Index 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 Sprott Gold and Voya Index into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sprott Gold Equity and Voya Index Solution, you can compare the effects of market volatilities on Sprott Gold and Voya Index 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 Sprott Gold with a short position of Voya Index. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sprott Gold and Voya Index.
Diversification Opportunities for Sprott Gold and Voya Index
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Sprott and Voya is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding Sprott Gold Equity and Voya Index Solution in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Index Solution and Sprott Gold 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 Sprott Gold Equity are associated (or correlated) with Voya Index. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Index Solution has no effect on the direction of Sprott Gold i.e., Sprott Gold and Voya Index go up and down completely randomly.
Pair Corralation between Sprott Gold and Voya Index
Assuming the 90 days horizon Sprott Gold is expected to generate 1.01 times less return on investment than Voya Index. In addition to that, Sprott Gold is 2.32 times more volatile than Voya Index Solution. It trades about 0.05 of its total potential returns per unit of risk. Voya Index Solution is currently generating about 0.11 per unit of volatility. If you would invest 1,009 in Voya Index Solution on September 12, 2024 and sell it today you would earn a total of 432.00 from holding Voya Index Solution or generate 42.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Sprott Gold Equity vs. Voya Index Solution
Performance |
| Timeline |
| Sprott Gold Equity |
| Voya Index Solution |
Sprott Gold and Voya Index Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sprott Gold and Voya Index
The main advantage of trading using opposite Sprott Gold and Voya Index positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sprott Gold position performs unexpectedly, Voya Index 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 Index will offset losses from the drop in Voya Index's long position.| Sprott Gold vs. Sprott Junior Gold | Sprott Gold vs. Sprott Gold Miners | Sprott Gold vs. Europac Gold Fund | Sprott Gold vs. US Global GO |
| Voya Index vs. Short Precious Metals | Voya Index vs. Franklin Gold Precious | Voya Index vs. Sprott Gold Equity | Voya Index vs. Precious Metals And |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope |