Correlation Between Voya Target and Touchstone Sands
Can any of the company-specific risk be diversified away by investing in both Voya Target and Touchstone Sands 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 Target and Touchstone Sands into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Voya Target Retirement and Touchstone Sands Capital, you can compare the effects of market volatilities on Voya Target and Touchstone Sands 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 Target with a short position of Touchstone Sands. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Target and Touchstone Sands.
Diversification Opportunities for Voya Target and Touchstone Sands
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Voya and Touchstone is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Voya Target Retirement and Touchstone Sands Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Touchstone Sands Capital and Voya Target 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 Target Retirement are associated (or correlated) with Touchstone Sands. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Touchstone Sands Capital has no effect on the direction of Voya Target i.e., Voya Target and Touchstone Sands go up and down completely randomly.
Pair Corralation between Voya Target and Touchstone Sands
Assuming the 90 days horizon Voya Target is expected to generate 2.33 times less return on investment than Touchstone Sands. But when comparing it to its historical volatility, Voya Target Retirement is 2.33 times less risky than Touchstone Sands. It trades about 0.09 of its potential returns per unit of risk. Touchstone Sands Capital is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 1,005 in Touchstone Sands Capital on September 2, 2024 and sell it today you would earn a total of 840.00 from holding Touchstone Sands Capital or generate 83.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Voya Target Retirement vs. Touchstone Sands Capital
Performance |
| Timeline |
| Voya Target Retirement |
| Touchstone Sands Capital |
Voya Target and Touchstone Sands Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya Target and Touchstone Sands
The main advantage of trading using opposite Voya Target and Touchstone Sands positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Target position performs unexpectedly, Touchstone Sands 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 Touchstone Sands will offset losses from the drop in Touchstone Sands' long position.| Voya Target vs. Voya Bond Index | Voya Target vs. Voya Bond Index | Voya Target vs. Voya Limited Maturity | Voya Target vs. Voya Limited Maturity |
| Touchstone Sands vs. T Rowe Price | Touchstone Sands vs. Pace Municipal Fixed | Touchstone Sands vs. Oklahoma Municipal Fund | Touchstone Sands vs. Franklin High Yield |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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