Correlation Between Small Cap and Voya Us
Can any of the company-specific risk be diversified away by investing in both Small Cap and Voya Us 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 Small Cap and Voya Us into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Small Cap Stock and Voya Bond Index, you can compare the effects of market volatilities on Small Cap and Voya Us 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 Small Cap with a short position of Voya Us. Check out your portfolio center. Please also check ongoing floating volatility patterns of Small Cap and Voya Us.
Diversification Opportunities for Small Cap and Voya Us
Excellent diversification
The 3 months correlation between Small and Voya is -0.55. Overlapping area represents the amount of risk that can be diversified away by holding Small Cap Stock and Voya Bond Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Bond Index and Small Cap 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 Small Cap Stock are associated (or correlated) with Voya Us. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Bond Index has no effect on the direction of Small Cap i.e., Small Cap and Voya Us go up and down completely randomly.
Pair Corralation between Small Cap and Voya Us
Assuming the 90 days horizon Small Cap Stock is expected to generate 4.07 times more return on investment than Voya Us. However, Small Cap is 4.07 times more volatile than Voya Bond Index. It trades about 0.13 of its potential returns per unit of risk. Voya Bond Index is currently generating about -0.05 per unit of risk. If you would invest 1,387 in Small Cap Stock on September 2, 2024 and sell it today you would earn a total of 142.00 from holding Small Cap Stock or generate 10.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Small Cap Stock vs. Voya Bond Index
Performance |
| Timeline |
| Small Cap Stock |
| Voya Bond Index |
Small Cap and Voya Us Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Small Cap and Voya Us
The main advantage of trading using opposite Small Cap and Voya Us positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Small Cap position performs unexpectedly, Voya Us 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 Us will offset losses from the drop in Voya Us' long position.| Small Cap vs. Calamos Global Equity | Small Cap vs. Cutler Equity | Small Cap vs. Us Vector Equity | Small Cap vs. Small Cap Equity |
| Voya Us vs. Technology Ultrasector Profund | Voya Us vs. Science Technology Fund | Voya Us vs. Biotechnology Ultrasector Profund | Voya Us vs. Goldman Sachs Technology |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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