Correlation Between Ashmore Emerging and Mainstay Floating
Can any of the company-specific risk be diversified away by investing in both Ashmore Emerging and Mainstay Floating 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 Ashmore Emerging and Mainstay Floating into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ashmore Emerging Markets and Mainstay Floating Rate, you can compare the effects of market volatilities on Ashmore Emerging and Mainstay Floating 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 Ashmore Emerging with a short position of Mainstay Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ashmore Emerging and Mainstay Floating.
Diversification Opportunities for Ashmore Emerging and Mainstay Floating
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Ashmore and Mainstay is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Ashmore Emerging Markets and Mainstay Floating Rate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Floating Rate and Ashmore 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 Ashmore Emerging Markets are associated (or correlated) with Mainstay Floating. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Floating Rate has no effect on the direction of Ashmore Emerging i.e., Ashmore Emerging and Mainstay Floating go up and down completely randomly.
Pair Corralation between Ashmore Emerging and Mainstay Floating
Assuming the 90 days horizon Ashmore Emerging is expected to generate 2.62 times less return on investment than Mainstay Floating. But when comparing it to its historical volatility, Ashmore Emerging Markets is 1.35 times less risky than Mainstay Floating. It trades about 0.15 of its potential returns per unit of risk. Mainstay Floating Rate is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest 847.00 in Mainstay Floating Rate on November 3, 2024 and sell it today you would earn a total of 42.00 from holding Mainstay Floating Rate or generate 4.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ashmore Emerging Markets vs. Mainstay Floating Rate
Performance |
| Timeline |
| Ashmore Emerging Markets |
| Mainstay Floating Rate |
Ashmore Emerging and Mainstay Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ashmore Emerging and Mainstay Floating
The main advantage of trading using opposite Ashmore Emerging and Mainstay Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ashmore Emerging position performs unexpectedly, Mainstay Floating 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 Floating will offset losses from the drop in Mainstay Floating's long position.| Ashmore Emerging vs. Harbor Diversified International | Ashmore Emerging vs. Madison Diversified Income | Ashmore Emerging vs. Lord Abbett Diversified | Ashmore Emerging vs. Diversified Income Fund |
| Mainstay Floating vs. Gabelli Convertible And | Mainstay Floating vs. Lord Abbett Convertible | Mainstay Floating vs. Absolute Convertible Arbitrage | Mainstay Floating vs. Rationalpier 88 Convertible |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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