Correlation Between BlackRock Global and Voya Global

Can any of the company-specific risk be diversified away by investing in both BlackRock Global and Voya Global 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 BlackRock Global and Voya Global into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between BlackRock Global Opportunities and Voya Global Equity, you can compare the effects of market volatilities on BlackRock Global and Voya Global 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 BlackRock Global with a short position of Voya Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of BlackRock Global and Voya Global.

Diversification Opportunities for BlackRock Global and Voya Global

0.55

Correlation Coefficient

BlackRock Global  Voya Global

Very weak diversification

The 3 months correlation between BlackRock and Voya is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding BlackRock Global Opportunities and Voya Global Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Global Equity and BlackRock Global 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 BlackRock Global Opportunities are associated (or correlated) with Voya Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Global Equity has no effect on the direction of BlackRock Global i.e., BlackRock Global and Voya Global go up and down completely randomly.

Pair Corralation between BlackRock Global and Voya Global

Considering the 90-day investment horizon BlackRock Global Opportunities is expected to generate 1.11 times more return on investment than Voya Global. However, BlackRock Global is 1.11 times more volatile than Voya Global Equity. It trades about 0.1 of its potential returns per unit of risk. Voya Global Equity is currently generating about 0.06 per unit of risk. If you would invest  1,106  in BlackRock Global Opportunities on September 14, 2024 and sell it today you would earn a total of  15.00  from holding BlackRock Global Opportunities or generate 1.36% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

BlackRock Global Opportunities  vs.  Voya Global Equity

BlackRock Global Opp

Risk-Adjusted Performance

4 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in BlackRock Global Opportunities are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of rather sound basic indicators, BlackRock Global is not utilizing all of its potentials. The new stock price tumult, may contribute to shorter-term losses for the shareholders.

Voya Global Equity

Risk-Adjusted Performance

0 of 100

Weak

Over the last 90 days Voya Global Equity has generated negative risk-adjusted returns adding no value to fund investors. In spite of rather sound technical and fundamental indicators, Voya Global is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with BlackRock Global and Voya Global

The main advantage of trading using opposite BlackRock Global and Voya Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BlackRock Global position performs unexpectedly, Voya Global 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 Global will offset losses from the drop in Voya Global's long position.

The idea behind BlackRock Global Opportunities and Voya Global Equity pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.