Correlation Between Voya Large-cap and Polar Capital
Can any of the company-specific risk be diversified away by investing in both Voya Large-cap and Polar Capital 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 Large-cap and Polar Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Voya Large Cap Growth and Polar Capital Emerging, you can compare the effects of market volatilities on Voya Large-cap and Polar Capital 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 Large-cap with a short position of Polar Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Large-cap and Polar Capital.
Diversification Opportunities for Voya Large-cap and Polar Capital
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Voya and Polar is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Voya Large Cap Growth and Polar Capital Emerging in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Polar Capital Emerging and Voya Large-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 Voya Large Cap Growth are associated (or correlated) with Polar Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Polar Capital Emerging has no effect on the direction of Voya Large-cap i.e., Voya Large-cap and Polar Capital go up and down completely randomly.
Pair Corralation between Voya Large-cap and Polar Capital
Assuming the 90 days horizon Voya Large Cap Growth is expected to under-perform the Polar Capital. In addition to that, Voya Large-cap is 1.33 times more volatile than Polar Capital Emerging. It trades about -0.11 of its total potential returns per unit of risk. Polar Capital Emerging is currently generating about -0.05 per unit of volatility. If you would invest 1,093 in Polar Capital Emerging on November 28, 2024 and sell it today you would lose (11.00) from holding Polar Capital Emerging or give up 1.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Voya Large Cap Growth vs. Polar Capital Emerging
Performance |
| Timeline |
| Voya Large Cap |
| Polar Capital Emerging |
Voya Large-cap and Polar Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya Large-cap and Polar Capital
The main advantage of trading using opposite Voya Large-cap and Polar Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Large-cap position performs unexpectedly, Polar Capital 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 Polar Capital will offset losses from the drop in Polar Capital's long position.| Voya Large-cap vs. Voya Target Retirement | Voya Large-cap vs. Tiaa Cref Lifestyle Moderate | Voya Large-cap vs. Columbia Moderate Growth | Voya Large-cap vs. Jp Morgan Smartretirement |
| Polar Capital vs. Polar Capital Emerging | Polar Capital vs. Calvert Short Duration | Polar Capital vs. Buffalo High Yield | Polar Capital vs. Blackrock Low Duration |
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 Stocks Directory module to find actively traded stocks across global markets.
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