Correlation Between Buffalo High and Mainstay Conservative
Can any of the company-specific risk be diversified away by investing in both Buffalo High and Mainstay Conservative 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 Buffalo High and Mainstay Conservative into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Buffalo High Yield and Mainstay Conservative Etf, you can compare the effects of market volatilities on Buffalo High and Mainstay Conservative 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 Buffalo High with a short position of Mainstay Conservative. Check out your portfolio center. Please also check ongoing floating volatility patterns of Buffalo High and Mainstay Conservative.
Diversification Opportunities for Buffalo High and Mainstay Conservative
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Buffalo and Mainstay is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Buffalo High Yield and Mainstay Conservative Etf in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Conservative Etf and Buffalo High 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 Buffalo High Yield are associated (or correlated) with Mainstay Conservative. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Conservative Etf has no effect on the direction of Buffalo High i.e., Buffalo High and Mainstay Conservative go up and down completely randomly.
Pair Corralation between Buffalo High and Mainstay Conservative
Assuming the 90 days horizon Buffalo High is expected to generate 2.78 times less return on investment than Mainstay Conservative. But when comparing it to its historical volatility, Buffalo High Yield is 1.9 times less risky than Mainstay Conservative. It trades about 0.12 of its potential returns per unit of risk. Mainstay Conservative Etf is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 1,111 in Mainstay Conservative Etf on September 13, 2024 and sell it today you would earn a total of 12.00 from holding Mainstay Conservative Etf or generate 1.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Buffalo High Yield vs. Mainstay Conservative Etf
Performance |
| Timeline |
| Buffalo High Yield |
| Mainstay Conservative Etf |
Buffalo High and Mainstay Conservative Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Buffalo High and Mainstay Conservative
The main advantage of trading using opposite Buffalo High and Mainstay Conservative positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Buffalo High position performs unexpectedly, Mainstay Conservative 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 Conservative will offset losses from the drop in Mainstay Conservative's long position.| Buffalo High vs. Buffalo Flexible Income | Buffalo High vs. Buffalo Growth Fund | Buffalo High vs. Buffalo Mid Cap | Buffalo High vs. Buffalo Emerging Opportunities |
| Mainstay Conservative vs. Mainstay High Yield | Mainstay Conservative vs. Mainstay Tax Free | Mainstay Conservative vs. Mainstay Income Builder | Mainstay Conservative 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
Other Complementary Tools
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets |