Correlation Between Ing Intermediate and Voya Retirement

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

Diversification Opportunities for Ing Intermediate and Voya Retirement

0.8
  Correlation Coefficient

Very poor diversification

The 3 months correlation between Ing and Voya is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Ing Intermediate Bond and Voya Retirement Servative in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Retirement Servative and Ing Intermediate 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 Ing Intermediate Bond are associated (or correlated) with Voya Retirement. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Retirement Servative has no effect on the direction of Ing Intermediate i.e., Ing Intermediate and Voya Retirement go up and down completely randomly.

Pair Corralation between Ing Intermediate and Voya Retirement

Assuming the 90 days horizon Ing Intermediate Bond is expected to under-perform the Voya Retirement. But the mutual fund apears to be less risky and, when comparing its historical volatility, Ing Intermediate Bond is 1.51 times less risky than Voya Retirement. The mutual fund trades about -0.34 of its potential returns per unit of risk. The Voya Retirement Servative is currently generating about -0.22 of returns per unit of risk over similar time horizon. If you would invest  816.00  in Voya Retirement Servative on October 14, 2024 and sell it today you would lose (12.00) from holding Voya Retirement Servative or give up 1.47% of portfolio value over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthStrong
Accuracy100.0%
ValuesDaily Returns

Ing Intermediate Bond  vs.  Voya Retirement Servative

 Performance 
       Timeline  
Ing Intermediate Bond 

Risk-Adjusted Performance

0 of 100

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

Risk-Adjusted Performance

0 of 100

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

Ing Intermediate and Voya Retirement Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Ing Intermediate and Voya Retirement

The main advantage of trading using opposite Ing Intermediate and Voya Retirement positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ing Intermediate position performs unexpectedly, Voya Retirement 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 Retirement will offset losses from the drop in Voya Retirement's long position.
The idea behind Ing Intermediate Bond and Voya Retirement Servative 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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.

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