Correlation Between Barings Emerging and Mainstay Tax
Can any of the company-specific risk be diversified away by investing in both Barings Emerging and Mainstay Tax 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 Tax 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 Tax Advantaged, you can compare the effects of market volatilities on Barings Emerging and Mainstay Tax 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 Tax. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Emerging and Mainstay Tax.
Diversification Opportunities for Barings Emerging and Mainstay Tax
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Barings and Mainstay is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Barings Emerging Markets and Mainstay Tax Advantaged in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Tax Advantaged 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 Tax. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Tax Advantaged has no effect on the direction of Barings Emerging i.e., Barings Emerging and Mainstay Tax go up and down completely randomly.
Pair Corralation between Barings Emerging and Mainstay Tax
Assuming the 90 days horizon Barings Emerging Markets is expected to generate 3.32 times more return on investment than Mainstay Tax. However, Barings Emerging is 3.32 times more volatile than Mainstay Tax Advantaged. It trades about 0.11 of its potential returns per unit of risk. Mainstay Tax Advantaged is currently generating about 0.17 per unit of risk. If you would invest 685.00 in Barings Emerging Markets on September 1, 2024 and sell it today you would earn a total of 74.00 from holding Barings Emerging Markets or generate 10.8% 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 Tax Advantaged
Performance |
| Timeline |
| Barings Emerging Markets |
| Mainstay Tax Advantaged |
Barings Emerging and Mainstay Tax Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Emerging and Mainstay Tax
The main advantage of trading using opposite Barings Emerging and Mainstay Tax positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Emerging position performs unexpectedly, Mainstay Tax 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 Tax will offset losses from the drop in Mainstay Tax's long position.| Barings Emerging vs. Artisan High Income | Barings Emerging vs. Federated Ohio Municipal | Barings Emerging vs. Versatile Bond Portfolio | Barings Emerging vs. Ambrus Core Bond |
| Mainstay Tax vs. Mainstay High Yield | Mainstay Tax vs. Mainstay Tax Free | Mainstay Tax vs. Mainstay Income Builder | Mainstay Tax 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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