Correlation Between Baird Short-term and Voya Us

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

By analyzing existing cross correlation between Baird Short Term Municipal and Voya Stock Index, you can compare the effects of market volatilities on Baird Short-term 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 Baird Short-term with a short position of Voya Us. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baird Short-term and Voya Us.

Diversification Opportunities for Baird Short-term and Voya Us

-0.43

Correlation Coefficient

Baird Short-term  Voya Us

Very good diversification

The 3 months correlation between Baird and Voya is -0.43. Overlapping area represents the amount of risk that can be diversified away by holding Baird Short Term Municipal and Voya Stock Index in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Stock Index and Baird Short-term 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 Baird Short Term Municipal 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 Stock Index has no effect on the direction of Baird Short-term i.e., Baird Short-term and Voya Us go up and down completely randomly.

Pair Corralation between Baird Short-term and Voya Us

Assuming the 90 days horizon Baird Short Term Municipal is expected to generate 0.08 times more return on investment than Voya Us. However, Baird Short Term Municipal is 12.83 times less risky than Voya Us. It trades about 0.21 of its potential returns per unit of risk. Voya Stock Index is currently generating about -0.07 per unit of risk. If you would invest  990.00  in Baird Short Term Municipal on December 27, 2024 and sell it today you would earn a total of  10.00  from holding Baird Short Term Municipal or generate 1.01% return on investment over 90 days.

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

Baird Short Term Municipal  vs.  Voya Stock Index

Baird Short Term

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Baird Short Term Municipal are ranked lower than 16 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Baird Short-term is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Voya Stock Index

Risk-Adjusted Performance

Very Weak

Over the last 90 days Voya Stock Index has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Voya Us is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Baird Short-term and Voya Us

The main advantage of trading using opposite Baird Short-term and Voya Us positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baird Short-term 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.

The idea behind Baird Short Term Municipal and Voya Stock Index 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 Global Correlations module to find global opportunities by holding instruments from different markets.