Correlation Between Allianzgi Health and Voya Global

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

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

Diversification Opportunities for Allianzgi Health and Voya Global

0.25

Correlation Coefficient

Allianzgi Health  Voya Global

Modest diversification

The 3 months correlation between Allianzgi and Voya is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Allianzgi Health Sciences and Voya Global Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Global Equity and Allianzgi Health 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 Allianzgi Health Sciences are associated (or correlated) with Voya Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Global Equity has no effect on the direction of Allianzgi Health i.e., Allianzgi Health and Voya Global go up and down completely randomly.

Pair Corralation between Allianzgi Health and Voya Global

Assuming the 90 days horizon Allianzgi Health Sciences is expected to under-perform the Voya Global. In addition to that, Allianzgi Health is 1.38 times more volatile than Voya Global Equity. It trades about -0.02 of its total potential returns per unit of risk. Voya Global Equity is currently generating about 0.18 per unit of volatility. If you would invest  4,570  in Voya Global Equity on December 22, 2024 and sell it today you would earn a total of  311.00  from holding Voya Global Equity or generate 6.81% return on investment over 90 days.

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

Allianzgi Health Sciences  vs.  Voya Global Equity

Allianzgi Health Sciences

Risk-Adjusted Performance

Very Weak

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

Voya Global Equity

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Voya Global Equity are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Voya Global may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Allianzgi Health and Voya Global

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

The idea behind Allianzgi Health Sciences and Voya Global Equity 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..