Correlation Between Hamilton Insurance and Voya Financial

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

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

Diversification Opportunities for Hamilton Insurance and Voya Financial

-0.16

Correlation Coefficient

Hamilton Insurance  Voya Financial

Good diversification

The 3 months correlation between Hamilton and Voya is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Hamilton Insurance Group, and Voya Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Financial and Hamilton Insurance 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 Hamilton Insurance Group, are associated (or correlated) with Voya Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Financial has no effect on the direction of Hamilton Insurance i.e., Hamilton Insurance and Voya Financial go up and down completely randomly.

Pair Corralation between Hamilton Insurance and Voya Financial

Allowing for the 90-day total investment horizon Hamilton Insurance Group, is expected to generate 1.11 times more return on investment than Voya Financial. However, Hamilton Insurance is 1.11 times more volatile than Voya Financial. It trades about 0.1 of its potential returns per unit of risk. Voya Financial is currently generating about 0.03 per unit of risk. If you would invest  1,896  in Hamilton Insurance Group, on December 19, 2024 and sell it today you would earn a total of  176.00  from holding Hamilton Insurance Group, or generate 9.28% return on investment over 90 days.

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

Hamilton Insurance Group,  vs.  Voya Financial

Hamilton Insurance Group,

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Hamilton Insurance Group, are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. Despite nearly inconsistent technical and fundamental indicators, Hamilton Insurance may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Voya Financial

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Voya Financial are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, Voya Financial is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Hamilton Insurance and Voya Financial

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

The idea behind Hamilton Insurance Group, and Voya Financial 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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.