Correlation Between Voya Target and Nationwide Amundi

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

Diversification Opportunities for Voya Target and Nationwide Amundi

-0.22
  Correlation Coefficient

Very good diversification

The 3 months correlation between Voya and Nationwide is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Voya Target Retirement and Nationwide Amundi Strategic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nationwide Amundi and Voya Target 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 Target Retirement are associated (or correlated) with Nationwide Amundi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nationwide Amundi has no effect on the direction of Voya Target i.e., Voya Target and Nationwide Amundi go up and down completely randomly.

Pair Corralation between Voya Target and Nationwide Amundi

Assuming the 90 days horizon Voya Target Retirement is expected to generate 5.12 times more return on investment than Nationwide Amundi. However, Voya Target is 5.12 times more volatile than Nationwide Amundi Strategic. It trades about 0.08 of its potential returns per unit of risk. Nationwide Amundi Strategic is currently generating about 0.28 per unit of risk. If you would invest  1,096  in Voya Target Retirement on October 26, 2024 and sell it today you would earn a total of  276.00  from holding Voya Target Retirement or generate 25.18% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy100.0%
ValuesDaily Returns

Voya Target Retirement  vs.  Nationwide Amundi Strategic

 Performance 
       Timeline  
Voya Target Retirement 

Risk-Adjusted Performance

4 of 100

 
Weak
 
Strong
Insignificant
Compared to the overall equity markets, risk-adjusted returns on investments in Voya Target Retirement are ranked lower than 4 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward-looking indicators, Voya Target is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Nationwide Amundi 

Risk-Adjusted Performance

34 of 100

 
Weak
 
Strong
Very Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Nationwide Amundi Strategic are ranked lower than 34 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical indicators, Nationwide Amundi is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Voya Target and Nationwide Amundi Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Voya Target and Nationwide Amundi

The main advantage of trading using opposite Voya Target and Nationwide Amundi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Voya Target position performs unexpectedly, Nationwide Amundi 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 Nationwide Amundi will offset losses from the drop in Nationwide Amundi's long position.
The idea behind Voya Target Retirement and Nationwide Amundi Strategic 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.

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