Correlation Between Voya Midcap and Dodge International

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

By analyzing existing cross correlation between Voya Midcap Opportunities and Dodge International Stock, you can compare the effects of market volatilities on Voya Midcap and Dodge International 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 Midcap with a short position of Dodge International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Voya Midcap and Dodge International.

Diversification Opportunities for Voya Midcap and Dodge International

-0.75

Correlation Coefficient

Voya Midcap  Dodge International

Pay attention - limited upside

The 3 months correlation between Voya and Dodge is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Voya Midcap Opportunities and Dodge International Stock in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dodge International Stock and Voya Midcap 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 Midcap Opportunities are associated (or correlated) with Dodge International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dodge International Stock has no effect on the direction of Voya Midcap i.e., Voya Midcap and Dodge International go up and down completely randomly.

Pair Corralation between Voya Midcap and Dodge International

Assuming the 90 days horizon Voya Midcap Opportunities is expected to generate 1.26 times more return on investment than Dodge International. However, Voya Midcap is 1.26 times more volatile than Dodge International Stock. It trades about 0.13 of its potential returns per unit of risk. Dodge International Stock is currently generating about -0.13 per unit of risk. If you would invest  542.00  in Voya Midcap Opportunities on September 20, 2024 and sell it today you would earn a total of  52.00  from holding Voya Midcap Opportunities or generate 9.59% return on investment over 90 days.

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

Voya Midcap Opportunities  vs.  Dodge International Stock

Voya Midcap Opportunities

Risk-Adjusted Performance

10 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Voya Midcap Opportunities are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Voya Midcap may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Dodge International Stock

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Dodge International Stock has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's technical and fundamental indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Pair Trading with Voya Midcap and Dodge International

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

The idea behind Voya Midcap Opportunities and Dodge International Stock 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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.