Correlation Between Voya Multi and Energy Basic

Can any of the company-specific risk be diversified away by investing in both Voya Multi and Energy Basic 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 and Energy Basic 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 Energy Basic Materials, you can compare the effects of market volatilities on Voya Multi and Energy Basic 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 with a short position of Energy Basic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Multi and Energy Basic.

Diversification Opportunities for Voya Multi and Energy Basic

0.0

Correlation Coefficient

Voya Multi  Energy Basic

Pay attention - limited upside

The 3 months correlation between Voya and Energy is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Voya Multi Manager Internation and Energy Basic Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Energy Basic Materials and Voya Multi 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 Energy Basic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Energy Basic Materials has no effect on the direction of Voya Multi i.e., Voya Multi and Energy Basic go up and down completely randomly.

Pair Corralation between Voya Multi and Energy Basic

If you would invest  1,144  in Energy Basic Materials on December 28, 2024 and sell it today you would earn a total of  67.00  from holding Energy Basic Materials or generate 5.86% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Voya Multi Manager Internation  vs.  Energy Basic Materials

Voya Multi Manager

Risk-Adjusted Performance

Very Weak

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

Energy Basic Materials

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Energy Basic Materials are ranked lower than 8 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental drivers, Energy Basic is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Voya Multi and Energy Basic

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

The idea behind Voya Multi Manager International and Energy Basic Materials 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 Transaction History module to view history of all your transactions and understand their impact on performance.