Correlation Between Voya Large and Amg Timessquare

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

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

Diversification Opportunities for Voya Large and Amg Timessquare

0.54

Correlation Coefficient

Voya Large  Amg Timessquare

Very weak diversification

The 3 months correlation between Voya and Amg is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Voya Large Cap Growth and Amg Timessquare Mid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Amg Timessquare Mid and Voya Large 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 Large Cap Growth are associated (or correlated) with Amg Timessquare. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Amg Timessquare Mid has no effect on the direction of Voya Large i.e., Voya Large and Amg Timessquare go up and down completely randomly.

Pair Corralation between Voya Large and Amg Timessquare

Assuming the 90 days horizon Voya Large Cap Growth is expected to generate 0.9 times more return on investment than Amg Timessquare. However, Voya Large Cap Growth is 1.11 times less risky than Amg Timessquare. It trades about 0.07 of its potential returns per unit of risk. Amg Timessquare Mid is currently generating about -0.08 per unit of risk. If you would invest  5,779  in Voya Large Cap Growth on September 21, 2024 and sell it today you would earn a total of  294.00  from holding Voya Large Cap Growth or generate 5.09% return on investment over 90 days.

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

Voya Large Cap Growth  vs.  Amg Timessquare Mid

Voya Large Cap

Risk-Adjusted Performance

5 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Voya Large Cap Growth are ranked lower than 5 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Voya Large is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Amg Timessquare Mid

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Amg Timessquare Mid has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic 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 Large and Amg Timessquare

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

The idea behind Voya Large Cap Growth and Amg Timessquare Mid 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.