Correlation Between Ford and Mainstay Floating
Can any of the company-specific risk be diversified away by investing in both Ford 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 Ford and Mainstay Floating into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ford Motor and Mainstay Floating Rate, you can compare the effects of market volatilities on Ford 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 Ford with a short position of Mainstay Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ford and Mainstay Floating.
Diversification Opportunities for Ford and Mainstay Floating
-0.66 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Ford and Mainstay is -0.66. Overlapping area represents the amount of risk that can be diversified away by holding Ford Motor 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 Ford 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 Ford Motor 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 Ford i.e., Ford and Mainstay Floating go up and down completely randomly.
Pair Corralation between Ford and Mainstay Floating
Taking into account the 90-day investment horizon Ford Motor is expected to under-perform the Mainstay Floating. In addition to that, Ford is 43.12 times more volatile than Mainstay Floating Rate. It trades about -0.09 of its total potential returns per unit of risk. Mainstay Floating Rate is currently generating about -0.1 per unit of volatility. If you would invest 890.00 in Mainstay Floating Rate on November 9, 2024 and sell it today you would lose (1.00) from holding Mainstay Floating Rate or give up 0.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ford Motor vs. Mainstay Floating Rate
Performance |
| Timeline |
| Ford Motor |
| Mainstay Floating Rate |
Ford and Mainstay Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ford and Mainstay Floating
The main advantage of trading using opposite Ford and Mainstay Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ford 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.The idea behind Ford Motor and Mainstay Floating Rate 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 Floating vs. Six Circles Credit | Mainstay Floating vs. Multi Manager High Yield | Mainstay Floating vs. Voya High Yield | Mainstay Floating vs. Jpmorgan 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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |