Correlation Between Sterling Capital and Voya Solution
Can any of the company-specific risk be diversified away by investing in both Sterling Capital and Voya Solution 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 Sterling Capital and Voya Solution into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sterling Capital Stratton and Voya Solution 2060, you can compare the effects of market volatilities on Sterling Capital and Voya Solution 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 Sterling Capital with a short position of Voya Solution. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sterling Capital and Voya Solution.
Diversification Opportunities for Sterling Capital and Voya Solution
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Sterling and Voya is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Sterling Capital Stratton and Voya Solution 2060 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Solution 2060 and Sterling Capital 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 Sterling Capital Stratton are associated (or correlated) with Voya Solution. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Solution 2060 has no effect on the direction of Sterling Capital i.e., Sterling Capital and Voya Solution go up and down completely randomly.
Pair Corralation between Sterling Capital and Voya Solution
Assuming the 90 days horizon Sterling Capital is expected to generate 1.08 times less return on investment than Voya Solution. In addition to that, Sterling Capital is 1.47 times more volatile than Voya Solution 2060. It trades about 0.09 of its total potential returns per unit of risk. Voya Solution 2060 is currently generating about 0.14 per unit of volatility. If you would invest 957.00 in Voya Solution 2060 on September 1, 2024 and sell it today you would earn a total of 280.00 from holding Voya Solution 2060 or generate 29.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sterling Capital Stratton vs. Voya Solution 2060
Performance |
| Timeline |
| Sterling Capital Stratton |
| Voya Solution 2060 |
Sterling Capital and Voya Solution Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sterling Capital and Voya Solution
The main advantage of trading using opposite Sterling Capital and Voya Solution positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sterling Capital position performs unexpectedly, Voya Solution 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 Solution will offset losses from the drop in Voya Solution's long position.| Sterling Capital vs. Realty Income | Sterling Capital vs. Dynex Capital | Sterling Capital vs. First Industrial Realty | Sterling Capital vs. Healthcare Realty Trust |
| Voya Solution vs. Voya Bond Index | Voya Solution vs. Voya Bond Index | Voya Solution vs. Voya Limited Maturity | Voya Solution vs. Voya Limited Maturity |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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