Correlation Between Alphabet and Mainstay Floating
Can any of the company-specific risk be diversified away by investing in both Alphabet 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 Alphabet and Mainstay Floating into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alphabet Inc Class C and Mainstay Floating Rate, you can compare the effects of market volatilities on Alphabet 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 Alphabet with a short position of Mainstay Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alphabet and Mainstay Floating.
Diversification Opportunities for Alphabet and Mainstay Floating
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Alphabet and Mainstay is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Alphabet Inc Class C 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 Alphabet 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 Alphabet Inc Class C 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 Alphabet i.e., Alphabet and Mainstay Floating go up and down completely randomly.
Pair Corralation between Alphabet and Mainstay Floating
Given the investment horizon of 90 days Alphabet Inc Class C is expected to under-perform the Mainstay Floating. In addition to that, Alphabet is 40.71 times more volatile than Mainstay Floating Rate. It trades about -0.01 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 Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Alphabet Inc Class C vs. Mainstay Floating Rate
Performance |
| Timeline |
| Alphabet Class C |
| Mainstay Floating Rate |
Alphabet and Mainstay Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alphabet and Mainstay Floating
The main advantage of trading using opposite Alphabet and Mainstay Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alphabet 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 Alphabet Inc Class C 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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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