Correlation Between Auer Growth and Voya Securitized

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

By analyzing existing cross correlation between Auer Growth Fund and Voya Securitized Credit, you can compare the effects of market volatilities on Auer Growth and Voya Securitized 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 Auer Growth with a short position of Voya Securitized. Check out your portfolio center. Please also check ongoing floating volatility patterns of Auer Growth and Voya Securitized.

Diversification Opportunities for Auer Growth and Voya Securitized

0.72

Correlation Coefficient

Auer Growth  Voya Securitized

Poor diversification

The 3 months correlation between Auer and Voya is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Auer Growth Fund and Voya Securitized Credit in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Securitized Credit and Auer Growth 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 Auer Growth Fund are associated (or correlated) with Voya Securitized. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Securitized Credit has no effect on the direction of Auer Growth i.e., Auer Growth and Voya Securitized go up and down completely randomly.

Pair Corralation between Auer Growth and Voya Securitized

If you would invest  1,738  in Auer Growth Fund on September 5, 2024 and sell it today you would earn a total of  26.00  from holding Auer Growth Fund or generate 1.5% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	2.38%
Values	Daily Returns

Auer Growth Fund  vs.  Voya Securitized Credit

Auer Growth Fund

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Auer Growth Fund are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Auer Growth may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Voya Securitized Credit

Risk-Adjusted Performance

0 of 100

Very Weak

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

Pair Trading with Auer Growth and Voya Securitized

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

The idea behind Auer Growth Fund and Voya Securitized Credit 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.