Correlation Between Voya Global and Oxford Square

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

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

Diversification Opportunities for Voya Global and Oxford Square

0.3

Correlation Coefficient

Voya Global  Oxford Square

Weak diversification

The 3 months correlation between Voya and Oxford is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Voya Global Advantage and Oxford Square Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oxford Square Capital and Voya Global 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 Voya Global Advantage are associated (or correlated) with Oxford Square. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oxford Square Capital has no effect on the direction of Voya Global i.e., Voya Global and Oxford Square go up and down completely randomly.

Pair Corralation between Voya Global and Oxford Square

Considering the 90-day investment horizon Voya Global Advantage is expected to under-perform the Oxford Square. In addition to that, Voya Global is 2.04 times more volatile than Oxford Square Capital. It trades about -0.04 of its total potential returns per unit of risk. Oxford Square Capital is currently generating about 0.09 per unit of volatility. If you would invest  2,444  in Oxford Square Capital on October 13, 2024 and sell it today you would earn a total of  42.00  from holding Oxford Square Capital or generate 1.72% return on investment over 90 days.

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

Voya Global Advantage  vs.  Oxford Square Capital

Voya Global Advantage

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Voya Global Advantage has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong technical and fundamental indicators, Voya Global is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.

Oxford Square Capital

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Oxford Square Capital are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of fairly strong basic indicators, Oxford Square is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Voya Global and Oxford Square

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

The idea behind Voya Global Advantage and Oxford Square Capital 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.