Correlation Between Voya Large-cap and Vanguard Total
Can any of the company-specific risk be diversified away by investing in both Voya Large-cap and Vanguard Total 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 Vanguard Total 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 Vanguard Total Stock, you can compare the effects of market volatilities on Voya Large-cap and Vanguard Total 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 Vanguard Total. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Large-cap and Vanguard Total.
Diversification Opportunities for Voya Large-cap and Vanguard Total
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Voya and Vanguard is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Voya Large Cap Growth and Vanguard Total Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vanguard Total Stock 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 Vanguard Total. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vanguard Total Stock has no effect on the direction of Voya Large-cap i.e., Voya Large-cap and Vanguard Total go up and down completely randomly.
Pair Corralation between Voya Large-cap and Vanguard Total
Assuming the 90 days horizon Voya Large Cap Growth is expected to generate 1.33 times more return on investment than Vanguard Total. However, Voya Large-cap is 1.33 times more volatile than Vanguard Total Stock. It trades about 0.14 of its potential returns per unit of risk. Vanguard Total Stock is currently generating about 0.16 per unit of risk. If you would invest 5,822 in Voya Large Cap Growth on August 30, 2024 and sell it today you would earn a total of 353.00 from holding Voya Large Cap Growth or generate 6.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Voya Large Cap Growth vs. Vanguard Total Stock
Performance |
| Timeline |
| Voya Large Cap |
| Vanguard Total Stock |
Voya Large-cap and Vanguard Total Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya Large-cap and Vanguard Total
The main advantage of trading using opposite Voya Large-cap and Vanguard Total positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Large-cap position performs unexpectedly, Vanguard Total 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 Vanguard Total will offset losses from the drop in Vanguard Total's long position.| Voya Large-cap vs. Dodge Global Stock | Voya Large-cap vs. Us Global Leaders | Voya Large-cap vs. Ms Global Fixed | Voya Large-cap vs. Commonwealth Global Fund |
| Vanguard Total vs. Vanguard Total International | Vanguard Total vs. Vanguard Total Bond | Vanguard Total vs. Vanguard 500 Index | Vanguard Total vs. Vanguard Reit Index |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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