Correlation Between Ethereum and Mainstay High
Can any of the company-specific risk be diversified away by investing in both Ethereum 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 Ethereum and Mainstay High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ethereum and Mainstay High Yield, you can compare the effects of market volatilities on Ethereum 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 Ethereum with a short position of Mainstay High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ethereum and Mainstay High.
Diversification Opportunities for Ethereum and Mainstay High
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Ethereum and Mainstay is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Ethereum 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 Ethereum 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 Ethereum 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 Ethereum i.e., Ethereum and Mainstay High go up and down completely randomly.
Pair Corralation between Ethereum and Mainstay High
Assuming the 90 days trading horizon Ethereum is expected to generate 12.11 times more return on investment than Mainstay High. However, Ethereum is 12.11 times more volatile than Mainstay High Yield. It trades about 0.09 of its potential returns per unit of risk. Mainstay High Yield is currently generating about -0.01 per unit of risk. If you would invest 245,036 in Ethereum on November 2, 2024 and sell it today you would earn a total of 80,779 from holding Ethereum or generate 32.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 97.2% |
| Values | Daily Returns |
Ethereum vs. Mainstay High Yield
Performance |
| Timeline |
| Ethereum |
| Mainstay High Yield |
Ethereum and Mainstay High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ethereum and Mainstay High
The main advantage of trading using opposite Ethereum and Mainstay High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ethereum 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.The idea behind Ethereum and Mainstay High Yield pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Mainstay High vs. Lord Abbett Diversified | Mainstay High vs. Delaware Limited Term Diversified | Mainstay High vs. Locorr Market Trend | Mainstay High vs. Sp Midcap Index |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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