Correlation Between Ab Global and Mainstay Short
Can any of the company-specific risk be diversified away by investing in both Ab Global and Mainstay Short 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 Global and Mainstay Short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Global Real and Mainstay Short Duration, you can compare the effects of market volatilities on Ab Global and Mainstay Short 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 Global with a short position of Mainstay Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Global and Mainstay Short.
Diversification Opportunities for Ab Global and Mainstay Short
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ARECX and Mainstay is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Ab Global Real and Mainstay Short Duration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Short Duration and Ab Global 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 Global Real are associated (or correlated) with Mainstay Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Short Duration has no effect on the direction of Ab Global i.e., Ab Global and Mainstay Short go up and down completely randomly.
Pair Corralation between Ab Global and Mainstay Short
Assuming the 90 days horizon Ab Global Real is expected to generate 7.86 times more return on investment than Mainstay Short. However, Ab Global is 7.86 times more volatile than Mainstay Short Duration. It trades about 0.07 of its potential returns per unit of risk. Mainstay Short Duration is currently generating about 0.28 per unit of risk. If you would invest 1,319 in Ab Global Real on September 4, 2024 and sell it today you would earn a total of 195.00 from holding Ab Global Real or generate 14.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.6% |
| Values | Daily Returns |
Ab Global Real vs. Mainstay Short Duration
Performance |
| Timeline |
| Ab Global Real |
| Mainstay Short Duration |
Ab Global and Mainstay Short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Global and Mainstay Short
The main advantage of trading using opposite Ab Global and Mainstay Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Global position performs unexpectedly, Mainstay Short 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 Short will offset losses from the drop in Mainstay Short's long position.| Ab Global vs. Eventide Healthcare Life | Ab Global vs. Alger Health Sciences | Ab Global vs. Deutsche Health And | Ab Global vs. Blackrock Health Sciences |
| Mainstay Short vs. Mainstay High Yield | Mainstay Short vs. Mainstay Tax Free | Mainstay Short vs. Mainstay Income Builder | Mainstay Short 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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