Correlation Between Vy Goldman and Dana Large

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

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

Diversification Opportunities for Vy Goldman and Dana Large

-0.52

Correlation Coefficient

Vy Goldman  Dana Large

Excellent diversification

The 3 months correlation between VGSBX and Dana is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Vy Goldman Sachs and Dana Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dana Large Cap and Vy Goldman 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 Vy Goldman Sachs are associated (or correlated) with Dana Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dana Large Cap has no effect on the direction of Vy Goldman i.e., Vy Goldman and Dana Large go up and down completely randomly.

Pair Corralation between Vy Goldman and Dana Large

Assuming the 90 days horizon Vy Goldman Sachs is expected to under-perform the Dana Large. But the mutual fund apears to be less risky and, when comparing its historical volatility, Vy Goldman Sachs is 2.22 times less risky than Dana Large. The mutual fund trades about -0.18 of its potential returns per unit of risk. The Dana Large Cap is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  2,550  in Dana Large Cap on September 23, 2024 and sell it today you would earn a total of  104.00  from holding Dana Large Cap or generate 4.08% return on investment over 90 days.

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

Vy Goldman Sachs  vs.  Dana Large Cap

Vy Goldman Sachs

Risk-Adjusted Performance

0 of 100

Very Weak

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

Dana Large Cap

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Dana Large Cap are ranked lower than 6 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Dana Large is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Vy Goldman and Dana Large

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

The idea behind Vy Goldman Sachs and Dana Large Cap 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.