Correlation Between Forum Real and Mainstay High
Can any of the company-specific risk be diversified away by investing in both Forum Real 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 Forum Real and Mainstay High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Forum Real Estate and Mainstay High Yield, you can compare the effects of market volatilities on Forum Real 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 Forum Real with a short position of Mainstay High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Forum Real and Mainstay High.
Diversification Opportunities for Forum Real and Mainstay High
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Forum and Mainstay is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Forum Real Estate 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 Forum Real 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 Forum Real Estate 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 Forum Real i.e., Forum Real and Mainstay High go up and down completely randomly.
Pair Corralation between Forum Real and Mainstay High
Assuming the 90 days horizon Forum Real Estate is expected to generate 0.32 times more return on investment than Mainstay High. However, Forum Real Estate is 3.09 times less risky than Mainstay High. It trades about 0.46 of its potential returns per unit of risk. Mainstay High Yield is currently generating about 0.08 per unit of risk. If you would invest 777.00 in Forum Real Estate on December 1, 2024 and sell it today you would earn a total of 191.00 from holding Forum Real Estate or generate 24.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Forum Real Estate vs. Mainstay High Yield
Performance |
| Timeline |
| Forum Real Estate |
| Mainstay High Yield |
Forum Real and Mainstay High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Forum Real and Mainstay High
The main advantage of trading using opposite Forum Real and Mainstay High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Forum Real 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.| Forum Real vs. Calvert Moderate Allocation | Forum Real vs. Alternative Asset Allocation | Forum Real vs. Gmo Asset Allocation | Forum Real vs. Tax Managed Large Cap |
| Mainstay High vs. Buffalo High Yield | Mainstay High vs. Ultra Short Fixed Income | Mainstay High vs. Ab Bond Inflation | Mainstay High vs. Ambrus Core Bond |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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