Correlation Between Voya Midcap and Voya Solution

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Voya Midcap and Voya Solution 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 Midcap and Voya Solution into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Voya Midcap Opportunities and Voya Solution Aggressive, you can compare the effects of market volatilities on Voya Midcap and Voya Solution 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 Midcap with a short position of Voya Solution. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Midcap and Voya Solution.

Diversification Opportunities for Voya Midcap and Voya Solution

0.68
  Correlation Coefficient

Poor diversification

The 3 months correlation between Voya and Voya is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Voya Midcap Opportunities and Voya Solution Aggressive in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Solution Aggressive and Voya Midcap 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 Midcap Opportunities are associated (or correlated) with Voya Solution. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Solution Aggressive has no effect on the direction of Voya Midcap i.e., Voya Midcap and Voya Solution go up and down completely randomly.

Pair Corralation between Voya Midcap and Voya Solution

Assuming the 90 days horizon Voya Midcap is expected to generate 1.16 times less return on investment than Voya Solution. In addition to that, Voya Midcap is 1.48 times more volatile than Voya Solution Aggressive. It trades about 0.05 of its total potential returns per unit of risk. Voya Solution Aggressive is currently generating about 0.08 per unit of volatility. If you would invest  1,073  in Voya Solution Aggressive on December 2, 2024 and sell it today you would earn a total of  369.00  from holding Voya Solution Aggressive or generate 34.39% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthSignificant
Accuracy100.0%
ValuesDaily Returns

Voya Midcap Opportunities  vs.  Voya Solution Aggressive

 Performance 
       Timeline  
Voya Midcap Opportunities 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Voya Midcap Opportunities has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's basic indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.
Voya Solution Aggressive 

Risk-Adjusted Performance

Very Weak

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

Voya Midcap and Voya Solution Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Voya Midcap and Voya Solution

The main advantage of trading using opposite Voya Midcap and Voya Solution positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Midcap position performs unexpectedly, Voya Solution 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 Solution will offset losses from the drop in Voya Solution's long position.
The idea behind Voya Midcap Opportunities and Voya Solution Aggressive 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.

Other Complementary Tools

Portfolio Center
All portfolio management and optimization tools to improve performance of your portfolios
Economic Indicators
Top statistical indicators that provide insights into how an economy is performing
Investing Opportunities
Build portfolios using our predefined set of ideas and optimize them against your investing preferences
My Watchlist Analysis
Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like
Positions Ratings
Determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance