Correlation Between Mainstay Cushing and T Rowe
Can any of the company-specific risk be diversified away by investing in both Mainstay Cushing and T Rowe 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 Mainstay Cushing and T Rowe into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mainstay Cushing Mlp and T Rowe Price, you can compare the effects of market volatilities on Mainstay Cushing and T Rowe 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 Mainstay Cushing with a short position of T Rowe. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mainstay Cushing and T Rowe.
Diversification Opportunities for Mainstay Cushing and T Rowe
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Mainstay and PARCX is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay Cushing Mlp and T Rowe Price in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on T Rowe Price and Mainstay Cushing 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 Mainstay Cushing Mlp are associated (or correlated) with T Rowe. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of T Rowe Price has no effect on the direction of Mainstay Cushing i.e., Mainstay Cushing and T Rowe go up and down completely randomly.
Pair Corralation between Mainstay Cushing and T Rowe
Assuming the 90 days horizon Mainstay Cushing Mlp is expected to generate 3.61 times more return on investment than T Rowe. However, Mainstay Cushing is 3.61 times more volatile than T Rowe Price. It trades about 0.06 of its potential returns per unit of risk. T Rowe Price is currently generating about 0.12 per unit of risk. If you would invest 1,150 in Mainstay Cushing Mlp on September 14, 2024 and sell it today you would earn a total of 15.00 from holding Mainstay Cushing Mlp or generate 1.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mainstay Cushing Mlp vs. T Rowe Price
Performance |
| Timeline |
| Mainstay Cushing Mlp |
| T Rowe Price |
Mainstay Cushing and T Rowe Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mainstay Cushing and T Rowe
The main advantage of trading using opposite Mainstay Cushing and T Rowe positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mainstay Cushing position performs unexpectedly, T Rowe 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 T Rowe will offset losses from the drop in T Rowe's long position.| Mainstay Cushing vs. T Rowe Price | Mainstay Cushing vs. Morningstar Aggressive Growth | Mainstay Cushing vs. Franklin High Income | Mainstay Cushing vs. Siit High Yield |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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