Correlation Between Voya Multi-manager and Needham Aggressive

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

By analyzing existing cross correlation between Voya Multi Manager International and Needham Aggressive Growth, you can compare the effects of market volatilities on Voya Multi-manager and Needham Aggressive 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 Multi-manager with a short position of Needham Aggressive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Multi-manager and Needham Aggressive.

Diversification Opportunities for Voya Multi-manager and Needham Aggressive

-0.42

Correlation Coefficient

Voya Multi-manager  Needham Aggressive

Very good diversification

The 3 months correlation between Voya and Needham is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Voya Multi Manager Internation and Needham Aggressive Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Needham Aggressive Growth and Voya Multi-manager 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 Multi Manager International are associated (or correlated) with Needham Aggressive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Needham Aggressive Growth has no effect on the direction of Voya Multi-manager i.e., Voya Multi-manager and Needham Aggressive go up and down completely randomly.

Pair Corralation between Voya Multi-manager and Needham Aggressive

Assuming the 90 days horizon Voya Multi Manager International is expected to generate 0.5 times more return on investment than Needham Aggressive. However, Voya Multi Manager International is 1.98 times less risky than Needham Aggressive. It trades about 0.16 of its potential returns per unit of risk. Needham Aggressive Growth is currently generating about -0.06 per unit of risk. If you would invest  5,231  in Voya Multi Manager International on December 20, 2024 and sell it today you would earn a total of  452.00  from holding Voya Multi Manager International or generate 8.64% return on investment over 90 days.

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

Voya Multi Manager Internation  vs.  Needham Aggressive Growth

Voya Multi Manager

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Voya Multi Manager International are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Voya Multi-manager may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Needham Aggressive Growth

Risk-Adjusted Performance

Very Weak

Over the last 90 days Needham Aggressive Growth has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's forward indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Voya Multi-manager and Needham Aggressive

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

The idea behind Voya Multi Manager International and Needham Aggressive Growth 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 Money Managers module to screen money managers from public funds and ETFs managed around the world.