Correlation Between Ancorathelen Small and Mainstay Moderate
Can any of the company-specific risk be diversified away by investing in both Ancorathelen Small and Mainstay Moderate 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 Moderate 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 Moderate Allocation, you can compare the effects of market volatilities on Ancorathelen Small and Mainstay Moderate 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 Moderate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ancorathelen Small and Mainstay Moderate.
Diversification Opportunities for Ancorathelen Small and Mainstay Moderate
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Ancorathelen and Mainstay is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Ancorathelen Small Mid Cap and Mainstay Moderate Allocation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Moderate 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 Moderate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Moderate has no effect on the direction of Ancorathelen Small i.e., Ancorathelen Small and Mainstay Moderate go up and down completely randomly.
Pair Corralation between Ancorathelen Small and Mainstay Moderate
Assuming the 90 days horizon Ancorathelen Small Mid Cap is expected to generate 2.24 times more return on investment than Mainstay Moderate. However, Ancorathelen Small is 2.24 times more volatile than Mainstay Moderate Allocation. It trades about 0.13 of its potential returns per unit of risk. Mainstay Moderate Allocation is currently generating about 0.16 per unit of risk. If you would invest 1,571 in Ancorathelen Small Mid Cap on September 1, 2024 and sell it today you would earn a total of 703.00 from holding Ancorathelen Small Mid Cap or generate 44.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.63% |
| Values | Daily Returns |
Ancorathelen Small Mid Cap vs. Mainstay Moderate Allocation
Performance |
| Timeline |
| Ancorathelen Small Mid |
| Mainstay Moderate |
Ancorathelen Small and Mainstay Moderate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ancorathelen Small and Mainstay Moderate
The main advantage of trading using opposite Ancorathelen Small and Mainstay Moderate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ancorathelen Small position performs unexpectedly, Mainstay Moderate 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 Moderate will offset losses from the drop in Mainstay Moderate'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 Moderate vs. Investec Emerging Markets | Mainstay Moderate vs. Pnc Emerging Markets | Mainstay Moderate vs. Shelton Emerging Markets | Mainstay Moderate vs. Origin Emerging Markets |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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