Correlation Between Ab Value and Mainstay Large
Can any of the company-specific risk be diversified away by investing in both Ab Value 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 Ab Value and Mainstay Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Value Fund and Mainstay Large Cap, you can compare the effects of market volatilities on Ab Value 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 Ab Value with a short position of Mainstay Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Value and Mainstay Large.
Diversification Opportunities for Ab Value and Mainstay Large
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between ABVCX and Mainstay is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Ab Value Fund 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 Ab Value 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 Value Fund 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 Ab Value i.e., Ab Value and Mainstay Large go up and down completely randomly.
Pair Corralation between Ab Value and Mainstay Large
Assuming the 90 days horizon Ab Value Fund is expected to generate 0.72 times more return on investment than Mainstay Large. However, Ab Value Fund is 1.4 times less risky than Mainstay Large. It trades about 0.26 of its potential returns per unit of risk. Mainstay Large Cap is currently generating about 0.14 per unit of risk. If you would invest 1,954 in Ab Value Fund on August 28, 2024 and sell it today you would earn a total of 95.00 from holding Ab Value Fund or generate 4.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Value Fund vs. Mainstay Large Cap
Performance |
| Timeline |
| Ab Value Fund |
| Mainstay Large Cap |
Ab Value and Mainstay Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Value and Mainstay Large
The main advantage of trading using opposite Ab Value and Mainstay Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Value 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.| Ab Value vs. Morgan Stanley Government | Ab Value vs. Legg Mason Partners | Ab Value vs. Franklin Government Money | Ab Value vs. T Rowe Price |
| Mainstay Large vs. Mainstay High Yield | Mainstay Large vs. Mainstay Tax Free | Mainstay Large vs. Mainstay Income Builder | Mainstay Large vs. Mainstay Large Cap |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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