Correlation Between Ab Select and Voya Target

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

By analyzing existing cross correlation between Ab Select Equity and Voya Target In Retirement, you can compare the effects of market volatilities on Ab Select and Voya Target 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 Ab Select with a short position of Voya Target. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Select and Voya Target.

Diversification Opportunities for Ab Select and Voya Target

0.77

Correlation Coefficient

Ab Select  Voya Target

Poor diversification

The 3 months correlation between AUUIX and Voya is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Ab Select Equity and Voya Target In Retirement in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Voya Target In and Ab Select 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 Ab Select Equity are associated (or correlated) with Voya Target. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Voya Target In has no effect on the direction of Ab Select i.e., Ab Select and Voya Target go up and down completely randomly.

Pair Corralation between Ab Select and Voya Target

Assuming the 90 days horizon Ab Select Equity is expected to generate 2.33 times more return on investment than Voya Target. However, Ab Select is 2.33 times more volatile than Voya Target In Retirement. It trades about 0.24 of its potential returns per unit of risk. Voya Target In Retirement is currently generating about 0.25 per unit of risk. If you would invest  2,121  in Ab Select Equity on May 4, 2025 and sell it today you would earn a total of  224.00  from holding Ab Select Equity or generate 10.56% return on investment over 90 days.

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

Ab Select Equity  vs.  Voya Target In Retirement

Ab Select Equity

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Ab Select Equity are ranked lower than 18 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Ab Select may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Voya Target In

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Voya Target In Retirement are ranked lower than 20 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong essential indicators, Voya Target is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Ab Select and Voya Target

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

The idea behind Ab Select Equity and Voya Target In Retirement 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.

Check out your portfolio center.

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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.