Correlation Between Voya Solution and Vy Umbia
Can any of the company-specific risk be diversified away by investing in both Voya Solution and Vy Umbia 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 Solution and Vy Umbia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Voya Solution 2060 and Vy Umbia Small, you can compare the effects of market volatilities on Voya Solution and Vy Umbia 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 Solution with a short position of Vy Umbia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Solution and Vy Umbia.
Diversification Opportunities for Voya Solution and Vy Umbia
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Voya and ICVPX is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Voya Solution 2060 and Vy Umbia Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Vy Umbia Small and Voya Solution 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 Solution 2060 are associated (or correlated) with Vy Umbia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Vy Umbia Small has no effect on the direction of Voya Solution i.e., Voya Solution and Vy Umbia go up and down completely randomly.
Pair Corralation between Voya Solution and Vy Umbia
Assuming the 90 days horizon Voya Solution 2060 is expected to generate 0.54 times more return on investment than Vy Umbia. However, Voya Solution 2060 is 1.87 times less risky than Vy Umbia. It trades about 0.11 of its potential returns per unit of risk. Vy Umbia Small is currently generating about 0.03 per unit of risk. If you would invest 867.00 in Voya Solution 2060 on September 12, 2024 and sell it today you would earn a total of 383.00 from holding Voya Solution 2060 or generate 44.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Voya Solution 2060 vs. Vy Umbia Small
Performance |
| Timeline |
| Voya Solution 2060 |
| Vy Umbia Small |
Voya Solution and Vy Umbia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya Solution and Vy Umbia
The main advantage of trading using opposite Voya Solution and Vy Umbia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Solution position performs unexpectedly, Vy Umbia 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 Vy Umbia will offset losses from the drop in Vy Umbia's long position.| Voya Solution vs. American Funds 2060 | Voya Solution vs. American Funds 2060 | Voya Solution vs. American Funds 2060 | Voya Solution vs. T Rowe Price |
| Vy Umbia vs. Loomis Sayles Inflation | Vy Umbia vs. American Funds Inflation | Vy Umbia vs. Ab Bond Inflation | Vy Umbia vs. Federated Hermes Inflation |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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