Correlation Between Barings Emerging and Mainstay High
Can any of the company-specific risk be diversified away by investing in both Barings Emerging and Mainstay High 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 Barings Emerging and Mainstay High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barings Emerging Markets and Mainstay High Yield, you can compare the effects of market volatilities on Barings Emerging and Mainstay High 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 Barings Emerging with a short position of Mainstay High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Emerging and Mainstay High.
Diversification Opportunities for Barings Emerging and Mainstay High
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Barings and Mainstay is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Barings Emerging Markets and Mainstay High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay High Yield and Barings Emerging 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 Barings Emerging Markets are associated (or correlated) with Mainstay High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay High Yield has no effect on the direction of Barings Emerging i.e., Barings Emerging and Mainstay High go up and down completely randomly.
Pair Corralation between Barings Emerging and Mainstay High
Assuming the 90 days horizon Barings Emerging is expected to generate 1.23 times less return on investment than Mainstay High. In addition to that, Barings Emerging is 2.07 times more volatile than Mainstay High Yield. It trades about 0.06 of its total potential returns per unit of risk. Mainstay High Yield is currently generating about 0.16 per unit of volatility. If you would invest 489.00 in Mainstay High Yield on November 5, 2024 and sell it today you would earn a total of 32.00 from holding Mainstay High Yield or generate 6.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Barings Emerging Markets vs. Mainstay High Yield
Performance |
| Timeline |
| Barings Emerging Markets |
| Mainstay High Yield |
Barings Emerging and Mainstay High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Emerging and Mainstay High
The main advantage of trading using opposite Barings Emerging and Mainstay High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Emerging position performs unexpectedly, Mainstay High 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 High will offset losses from the drop in Mainstay High's long position.| Barings Emerging vs. Siit Emerging Markets | Barings Emerging vs. Barings Active Short | Barings Emerging vs. Mid Cap 15x Strategy | Barings Emerging vs. Western Asset Short |
| Mainstay High vs. Lord Abbett Health | Mainstay High vs. Eaton Vance Worldwide | Mainstay High vs. Invesco Global Health | Mainstay High vs. Alger Health Sciences |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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