Correlation Between Voya Solution and Goldman Sachs

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

By analyzing existing cross correlation between Voya Solution Conservative and Goldman Sachs Centrated, you can compare the effects of market volatilities on Voya Solution and Goldman Sachs 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 Solution with a short position of Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Solution and Goldman Sachs.

Diversification Opportunities for Voya Solution and Goldman Sachs

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Correlation Coefficient

Voya Solution  Goldman Sachs

Pay attention - limited upside

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

Pair Corralation between Voya Solution and Goldman Sachs

Assuming the 90 days horizon Voya Solution is expected to generate 1.29 times less return on investment than Goldman Sachs. But when comparing it to its historical volatility, Voya Solution Conservative is 3.65 times less risky than Goldman Sachs. It trades about 0.07 of its potential returns per unit of risk. Goldman Sachs Centrated is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest  1,638  in Goldman Sachs Centrated on October 10, 2024 and sell it today you would earn a total of  202.00  from holding Goldman Sachs Centrated or generate 12.33% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Voya Solution Conservative  vs.  Goldman Sachs Centrated

Voya Solution Conser

Risk-Adjusted Performance

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Very Weak

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

Goldman Sachs Centrated

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Goldman Sachs Centrated has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Goldman Sachs 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 Solution and Goldman Sachs

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

The idea behind Voya Solution Conservative and Goldman Sachs Centrated 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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.