Correlation Between Ancorathelen Small and Mainstay Large
Can any of the company-specific risk be diversified away by investing in both Ancorathelen Small and Mainstay 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 Ancorathelen Small and Mainstay Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ancorathelen Small Mid Cap and Mainstay Large Cap, you can compare the effects of market volatilities on Ancorathelen Small and Mainstay 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 Ancorathelen Small with a short position of Mainstay Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ancorathelen Small and Mainstay Large.
Diversification Opportunities for Ancorathelen Small and Mainstay Large
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Ancorathelen and Mainstay is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Ancorathelen Small Mid Cap and Mainstay Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Large Cap and Ancorathelen Small 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 Ancorathelen Small Mid Cap are associated (or correlated) with Mainstay Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Large Cap has no effect on the direction of Ancorathelen Small i.e., Ancorathelen Small and Mainstay Large go up and down completely randomly.
Pair Corralation between Ancorathelen Small and Mainstay Large
Assuming the 90 days horizon Ancorathelen Small Mid Cap is expected to generate 1.2 times more return on investment than Mainstay Large. However, Ancorathelen Small is 1.2 times more volatile than Mainstay Large Cap. It trades about 0.43 of its potential returns per unit of risk. Mainstay Large Cap is currently generating about 0.32 per unit of risk. If you would invest 2,040 in Ancorathelen Small Mid Cap on September 1, 2024 and sell it today you would earn a total of 234.00 from holding Ancorathelen Small Mid Cap or generate 11.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ancorathelen Small Mid Cap vs. Mainstay Large Cap
Performance |
| Timeline |
| Ancorathelen Small Mid |
| Mainstay Large Cap |
Ancorathelen Small and Mainstay Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ancorathelen Small and Mainstay Large
The main advantage of trading using opposite Ancorathelen Small and Mainstay Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ancorathelen Small position performs unexpectedly, Mainstay 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 Mainstay Large will offset losses from the drop in Mainstay Large's long position.| Ancorathelen Small vs. Aqr Large Cap | Ancorathelen Small vs. John Hancock Investment | Ancorathelen Small vs. Dodge Cox Stock | Ancorathelen Small vs. M Large Cap |
| Mainstay Large vs. Prudential Core Conservative | Mainstay Large vs. American Funds Conservative | Mainstay Large vs. Delaware Limited Term Diversified | Mainstay Large vs. Adams Diversified Equity |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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