Correlation Between Eaton Vance and Voya Global

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

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

Diversification Opportunities for Eaton Vance and Voya Global

0.57

Correlation Coefficient

Eaton Vance  Voya Global

Very weak diversification

The 3 months correlation between Eaton and Voya is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Eaton Vance Tax Managed 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 Eaton Vance 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 Eaton Vance Tax Managed 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 Eaton Vance i.e., Eaton Vance and Voya Global go up and down completely randomly.

Pair Corralation between Eaton Vance and Voya Global

Considering the 90-day investment horizon Eaton Vance Tax Managed is expected to generate 0.96 times more return on investment than Voya Global. However, Eaton Vance Tax Managed is 1.04 times less risky than Voya Global. It trades about 0.11 of its potential returns per unit of risk. Voya Global Equity is currently generating about 0.09 per unit of risk. If you would invest  844.00  in Eaton Vance Tax Managed on September 13, 2024 and sell it today you would earn a total of  11.00  from holding Eaton Vance Tax Managed or generate 1.3% return on investment over 90 days.

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

Eaton Vance Tax Managed  vs.  Voya Global Equity

Eaton Vance Tax

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Eaton Vance Tax Managed are ranked lower than 6 (%) of all funds and portfolios of funds over the last 90 days. Despite nearly stable basic indicators, Eaton Vance is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Voya Global Equity

Risk-Adjusted Performance

2 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Voya Global Equity are ranked lower than 2 (%) of all funds and portfolios of funds over the last 90 days. In spite of rather sound technical and fundamental indicators, Voya Global is not utilizing all of its potentials. The current stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Eaton Vance and Voya Global

The main advantage of trading using opposite Eaton Vance and Voya Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eaton Vance 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 Eaton Vance Tax Managed 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.

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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.