Correlation Between Voya Vacs and Voya Us
Can any of the company-specific risk be diversified away by investing in both Voya Vacs and Voya Us 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 Vacs and Voya Us into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Voya Vacs Index and Voya Bond Index, you can compare the effects of market volatilities on Voya Vacs and Voya Us 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 Vacs with a short position of Voya Us. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Vacs and Voya Us.
Diversification Opportunities for Voya Vacs and Voya Us
Poor diversification
The 3 months correlation between Voya and Voya is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Voya Vacs Index and Voya Bond Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Bond Index and Voya Vacs 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 Vacs Index are associated (or correlated) with Voya Us. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Bond Index has no effect on the direction of Voya Vacs i.e., Voya Vacs and Voya Us go up and down completely randomly.
Pair Corralation between Voya Vacs and Voya Us
Assuming the 90 days horizon Voya Vacs Index is expected to generate 3.44 times more return on investment than Voya Us. However, Voya Vacs is 3.44 times more volatile than Voya Bond Index. It trades about 0.05 of its potential returns per unit of risk. Voya Bond Index is currently generating about 0.1 per unit of risk. If you would invest 1,207 in Voya Vacs Index on November 5, 2024 and sell it today you would earn a total of 11.00 from holding Voya Vacs Index or generate 0.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Voya Vacs Index vs. Voya Bond Index
Performance |
| Timeline |
| Voya Vacs Index |
| Voya Bond Index |
Voya Vacs and Voya Us Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Voya Vacs and Voya Us
The main advantage of trading using opposite Voya Vacs and Voya Us positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Vacs position performs unexpectedly, Voya Us 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 Us will offset losses from the drop in Voya Us' long position.| Voya Vacs vs. Rmb Mendon Financial | Voya Vacs vs. Angel Oak Financial | Voya Vacs vs. Aig Government Money | Voya Vacs vs. Vanguard Money Market |
| Voya Us vs. Gamco Global Telecommunications | Voya Us vs. Legg Mason Partners | Voya Us vs. California Municipal Portfolio | Voya Us vs. Hartford Municipal Short |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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