Correlation Between Mirova Global and Voya Retirement

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

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

Diversification Opportunities for Mirova Global and Voya Retirement

0.6

Correlation Coefficient

Mirova Global  Voya Retirement

Poor diversification

The 3 months correlation between Mirova and Voya is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Mirova Global Green 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 Mirova 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 Mirova Global Green 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 Mirova Global i.e., Mirova Global and Voya Retirement go up and down completely randomly.

Pair Corralation between Mirova Global and Voya Retirement

Assuming the 90 days horizon Mirova Global Green is expected to under-perform the Voya Retirement. In addition to that, Mirova Global is 1.02 times more volatile than Voya Retirement Servative. It trades about -0.02 of its total potential returns per unit of risk. Voya Retirement Servative is currently generating about 0.06 per unit of volatility. If you would invest  803.00  in Voya Retirement Servative on December 19, 2024 and sell it today you would earn a total of  8.00  from holding Voya Retirement Servative or generate 1.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	98.33%
Values	Daily Returns

Mirova Global Green  vs.  Voya Retirement Servative

Mirova Global Green

Risk-Adjusted Performance

Very Weak

Over the last 90 days Mirova Global Green has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Mirova Global 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

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Voya Retirement Servative are ranked lower than 4 (%) of all funds and portfolios of funds over the last 90 days. 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.

Pair Trading with Mirova Global and Voya Retirement

The main advantage of trading using opposite Mirova Global and Voya Retirement positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mirova Global 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 Mirova Global Green 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 Stocks Directory module to find actively traded stocks across global markets.