Correlation Between Voya Bond and Barings Emerging
Can any of the company-specific risk be diversified away by investing in both Voya Bond and Barings Emerging 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 Bond and Barings Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Voya Bond Index and Barings Emerging Markets, you can compare the effects of market volatilities on Voya Bond and Barings Emerging 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 Bond with a short position of Barings Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Bond and Barings Emerging.
Diversification Opportunities for Voya Bond and Barings Emerging
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Voya and Barings is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Voya Bond Index and Barings Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barings Emerging Markets and Voya Bond 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 Bond Index are associated (or correlated) with Barings Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barings Emerging Markets has no effect on the direction of Voya Bond i.e., Voya Bond and Barings Emerging go up and down completely randomly.
Pair Corralation between Voya Bond and Barings Emerging
Assuming the 90 days horizon Voya Bond Index is expected to generate 1.18 times more return on investment than Barings Emerging. However, Voya Bond is 1.18 times more volatile than Barings Emerging Markets. It trades about 0.1 of its potential returns per unit of risk. Barings Emerging Markets is currently generating about 0.07 per unit of risk. If you would invest 908.00 in Voya Bond Index on September 14, 2024 and sell it today you would earn a total of 15.00 from holding Voya Bond Index or generate 1.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 7.29% |
| Values | Daily Returns |
Voya Bond Index vs. Barings Emerging Markets
Performance |
| Timeline |
| Voya Bond Index |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Barings Emerging Markets |
Voya Bond and Barings Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya Bond and Barings Emerging
The main advantage of trading using opposite Voya Bond and Barings Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Bond position performs unexpectedly, Barings Emerging 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 Barings Emerging will offset losses from the drop in Barings Emerging's long position.| Voya Bond vs. Bbh Intermediate Municipal | Voya Bond vs. Ishares Municipal Bond | Voya Bond vs. Blrc Sgy Mnp | Voya Bond vs. Franklin High Yield |
| Barings Emerging vs. Clearbridge Energy Mlp | Barings Emerging vs. Dreyfus Natural Resources | Barings Emerging vs. Jennison Natural Resources | Barings Emerging vs. Calvert Global Energy |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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