Correlation Between Voya Index and Voya Large
Can any of the company-specific risk be diversified away by investing in both Voya Index and Voya Large 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 Index and Voya Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Voya Index Solution and Voya Large Cap, you can compare the effects of market volatilities on Voya Index and Voya Large 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 Index with a short position of Voya Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Index and Voya Large.
Diversification Opportunities for Voya Index and Voya Large
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Voya and Voya is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Voya Index Solution and Voya Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Large Cap and Voya Index 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 Index Solution are associated (or correlated) with Voya Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Large Cap has no effect on the direction of Voya Index i.e., Voya Index and Voya Large go up and down completely randomly.
Pair Corralation between Voya Index and Voya Large
Assuming the 90 days horizon Voya Index Solution is expected to generate 0.59 times more return on investment than Voya Large. However, Voya Index Solution is 1.7 times less risky than Voya Large. It trades about -0.06 of its potential returns per unit of risk. Voya Large Cap is currently generating about -0.17 per unit of risk. If you would invest 1,659 in Voya Index Solution on December 1, 2024 and sell it today you would lose (14.00) from holding Voya Index Solution or give up 0.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Voya Index Solution vs. Voya Large Cap
Performance |
| Timeline |
| Voya Index Solution |
| Voya Large Cap |
Voya Index and Voya Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya Index and Voya Large
The main advantage of trading using opposite Voya Index and Voya Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Index position performs unexpectedly, Voya Large 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 Large will offset losses from the drop in Voya Large's long position.| Voya Index vs. Old Westbury Small | Voya Index vs. Touchstone Small Cap | Voya Index vs. Nuveen Small Cap | Voya Index vs. Glg Intl Small |
| Voya Large vs. Calvert Developed Market | Voya Large vs. Franklin Federal Limited Term | Voya Large vs. Ashmore Emerging Markets | Voya Large vs. Doubleline Emerging Markets |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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