Correlation Between Voya High and Inverse High
Can any of the company-specific risk be diversified away by investing in both Voya High and Inverse High 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 High and Inverse High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Voya High Yield and Inverse High Yield, you can compare the effects of market volatilities on Voya High and Inverse High 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 High with a short position of Inverse High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya High and Inverse High.
Diversification Opportunities for Voya High and Inverse High
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Voya and Inverse is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Voya High Yield and Inverse High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inverse High Yield and Voya High 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 High Yield are associated (or correlated) with Inverse High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inverse High Yield has no effect on the direction of Voya High i.e., Voya High and Inverse High go up and down completely randomly.
Pair Corralation between Voya High and Inverse High
Assuming the 90 days horizon Voya High Yield is expected to under-perform the Inverse High. But the mutual fund apears to be less risky and, when comparing its historical volatility, Voya High Yield is 1.97 times less risky than Inverse High. The mutual fund trades about -0.25 of its potential returns per unit of risk. The Inverse High Yield is currently generating about 0.23 of returns per unit of risk over similar time horizon. If you would invest 4,921 in Inverse High Yield on September 24, 2024 and sell it today you would earn a total of 83.00 from holding Inverse High Yield or generate 1.69% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 95.24% |
Values | Daily Returns |
Voya High Yield vs. Inverse High Yield
Performance |
Timeline |
Voya High Yield |
Inverse High Yield |
Voya High and Inverse High Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Voya High and Inverse High
The main advantage of trading using opposite Voya High and Inverse High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya High position performs unexpectedly, Inverse High 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 Inverse High will offset losses from the drop in Inverse High's long position.Voya High vs. Semiconductor Ultrasector Profund | Voya High vs. Multimedia Portfolio Multimedia | Voya High vs. Century Small Cap | Voya High vs. Ab Small Cap |
Inverse High vs. Basic Materials Fund | Inverse High vs. Basic Materials Fund | Inverse High vs. Banking Fund Class | Inverse High vs. Basic Materials Fund |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
Volatility Analysis Get historical volatility and risk analysis based on latest market data |