Correlation Between Voya Financial and Charoen Pokphand
Can any of the company-specific risk be diversified away by investing in both Voya Financial and Charoen Pokphand 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 Voya Financial and Charoen Pokphand into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Voya Financial and Charoen Pokphand Foods, you can compare the effects of market volatilities on Voya Financial and Charoen Pokphand 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 Voya Financial with a short position of Charoen Pokphand. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Financial and Charoen Pokphand.
Diversification Opportunities for Voya Financial and Charoen Pokphand
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Voya and Charoen is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Voya Financial and Charoen Pokphand Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Charoen Pokphand Foods and Voya Financial 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 Voya Financial are associated (or correlated) with Charoen Pokphand. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Charoen Pokphand Foods has no effect on the direction of Voya Financial i.e., Voya Financial and Charoen Pokphand go up and down completely randomly.
Pair Corralation between Voya Financial and Charoen Pokphand
Assuming the 90 days horizon Voya Financial is expected to generate 1.01 times more return on investment than Charoen Pokphand. However, Voya Financial is 1.01 times more volatile than Charoen Pokphand Foods. It trades about -0.01 of its potential returns per unit of risk. Charoen Pokphand Foods is currently generating about -0.02 per unit of risk. If you would invest 6,810 in Voya Financial on September 20, 2024 and sell it today you would lose (210.00) from holding Voya Financial or give up 3.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Voya Financial vs. Charoen Pokphand Foods
Performance |
| Timeline |
| Voya Financial |
| Charoen Pokphand Foods |
Voya Financial and Charoen Pokphand Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya Financial and Charoen Pokphand
The main advantage of trading using opposite Voya Financial and Charoen Pokphand positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Financial position performs unexpectedly, Charoen Pokphand 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 Charoen Pokphand will offset losses from the drop in Charoen Pokphand's long position.| Voya Financial vs. Ebro Foods SA | Voya Financial vs. TYSON FOODS A | Voya Financial vs. PARKEN Sport Entertainment | Voya Financial vs. Kaiser Aluminum |
| Charoen Pokphand vs. Tyson Foods | Charoen Pokphand vs. Mowi ASA | Charoen Pokphand vs. SalMar ASA | Charoen Pokphand vs. Superior Plus Corp |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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