Correlation Between Elfun Diversified and Voya Jpmorgan

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

By analyzing existing cross correlation between Elfun Diversified Fund and Voya Jpmorgan Small, you can compare the effects of market volatilities on Elfun Diversified and Voya Jpmorgan 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 Elfun Diversified with a short position of Voya Jpmorgan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Elfun Diversified and Voya Jpmorgan.

Diversification Opportunities for Elfun Diversified and Voya Jpmorgan

0.57

Correlation Coefficient

Elfun Diversified  Voya Jpmorgan

Very weak diversification

The 3 months correlation between Elfun and Voya is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Elfun Diversified Fund and Voya Jpmorgan Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Jpmorgan Small and Elfun Diversified 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 Elfun Diversified Fund are associated (or correlated) with Voya Jpmorgan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Jpmorgan Small has no effect on the direction of Elfun Diversified i.e., Elfun Diversified and Voya Jpmorgan go up and down completely randomly.

Pair Corralation between Elfun Diversified and Voya Jpmorgan

Assuming the 90 days horizon Elfun Diversified Fund is expected to generate 0.46 times more return on investment than Voya Jpmorgan. However, Elfun Diversified Fund is 2.18 times less risky than Voya Jpmorgan. It trades about 0.04 of its potential returns per unit of risk. Voya Jpmorgan Small is currently generating about 0.0 per unit of risk. If you would invest  2,101  in Elfun Diversified Fund on September 21, 2024 and sell it today you would earn a total of  44.00  from holding Elfun Diversified Fund or generate 2.09% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	99.07%
Values	Daily Returns

Elfun Diversified Fund  vs.  Voya Jpmorgan Small

Elfun Diversified

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Elfun Diversified Fund has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong technical and fundamental indicators, Elfun Diversified is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Voya Jpmorgan Small

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Elfun Diversified and Voya Jpmorgan

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

The idea behind Elfun Diversified Fund and Voya Jpmorgan Small 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.