Correlation Between Credit Suisse and Voya Global

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

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

Diversification Opportunities for Credit Suisse and Voya Global

0.71

Correlation Coefficient

Credit Suisse  Voya Global

Poor diversification

The 3 months correlation between Credit and Voya is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Credit Suisse High 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 Credit Suisse 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 Credit Suisse High 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 Credit Suisse i.e., Credit Suisse and Voya Global go up and down completely randomly.

Pair Corralation between Credit Suisse and Voya Global

Considering the 90-day investment horizon Credit Suisse is expected to generate 5.88 times less return on investment than Voya Global. But when comparing it to its historical volatility, Credit Suisse High is 1.09 times less risky than Voya Global. It trades about 0.03 of its potential returns per unit of risk. Voya Global Equity is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest  536.00  in Voya Global Equity on December 27, 2024 and sell it today you would earn a total of  34.00  from holding Voya Global Equity or generate 6.34% return on investment over 90 days.

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

Credit Suisse High  vs.  Voya Global Equity

Credit Suisse High

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Credit Suisse High are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong technical indicators, Credit Suisse is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Voya Global Equity

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Voya Global Equity are ranked lower than 11 (%) of all funds and portfolios of funds over the last 90 days. In spite of rather abnormal technical and fundamental indicators, Voya Global may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Credit Suisse and Voya Global

The main advantage of trading using opposite Credit Suisse and Voya Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Credit Suisse 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 Credit Suisse High 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.

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 Transaction History module to view history of all your transactions and understand their impact on performance.