Correlation Between Eaton Vance and Voya Asia

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

By analyzing existing cross correlation between Eaton Vance Tax and Voya Asia Pacific, you can compare the effects of market volatilities on Eaton Vance and Voya Asia 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 Eaton Vance with a short position of Voya Asia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eaton Vance and Voya Asia.

Diversification Opportunities for Eaton Vance and Voya Asia

-0.33

Correlation Coefficient

Eaton Vance  Voya Asia

Very good diversification

The 3 months correlation between Eaton and Voya is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding Eaton Vance Tax and Voya Asia Pacific in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Asia Pacific and Eaton Vance 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 Eaton Vance Tax are associated (or correlated) with Voya Asia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Asia Pacific has no effect on the direction of Eaton Vance i.e., Eaton Vance and Voya Asia go up and down completely randomly.

Pair Corralation between Eaton Vance and Voya Asia

Considering the 90-day investment horizon Eaton Vance Tax is expected to under-perform the Voya Asia. But the etf apears to be less risky and, when comparing its historical volatility, Eaton Vance Tax is 1.01 times less risky than Voya Asia. The etf trades about -0.12 of its potential returns per unit of risk. The Voya Asia Pacific is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest  604.00  in Voya Asia Pacific on December 26, 2024 and sell it today you would earn a total of  18.00  from holding Voya Asia Pacific or generate 2.98% return on investment over 90 days.

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

Eaton Vance Tax  vs.  Voya Asia Pacific

Eaton Vance Tax

Risk-Adjusted Performance

Very Weak

Over the last 90 days Eaton Vance Tax has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Eaton Vance is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Voya Asia Pacific

Risk-Adjusted Performance

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Voya Asia Pacific are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of rather sound basic indicators, Voya Asia is not utilizing all of its potentials. The latest stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Eaton Vance and Voya Asia

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

The idea behind Eaton Vance Tax and Voya Asia Pacific 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.