Correlation Between Power Global and Mainstay Moderate
Can any of the company-specific risk be diversified away by investing in both Power Global and Mainstay Moderate 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 Power Global and Mainstay Moderate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Power Global Tactical and Mainstay Moderate Allocation, you can compare the effects of market volatilities on Power Global and Mainstay Moderate 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 Power Global with a short position of Mainstay Moderate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Power Global and Mainstay Moderate.
Diversification Opportunities for Power Global and Mainstay Moderate
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Power and Mainstay is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Power Global Tactical and Mainstay Moderate Allocation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Moderate and Power Global 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 Power Global Tactical are associated (or correlated) with Mainstay Moderate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Moderate has no effect on the direction of Power Global i.e., Power Global and Mainstay Moderate go up and down completely randomly.
Pair Corralation between Power Global and Mainstay Moderate
Assuming the 90 days horizon Power Global Tactical is expected to generate 0.89 times more return on investment than Mainstay Moderate. However, Power Global Tactical is 1.12 times less risky than Mainstay Moderate. It trades about 0.04 of its potential returns per unit of risk. Mainstay Moderate Allocation is currently generating about -0.07 per unit of risk. If you would invest 1,100 in Power Global Tactical on November 28, 2024 and sell it today you would earn a total of 3.00 from holding Power Global Tactical or generate 0.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Power Global Tactical vs. Mainstay Moderate Allocation
Performance |
| Timeline |
| Power Global Tactical |
| Mainstay Moderate |
Power Global and Mainstay Moderate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Power Global and Mainstay Moderate
The main advantage of trading using opposite Power Global and Mainstay Moderate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Power Global position performs unexpectedly, Mainstay Moderate 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 Moderate will offset losses from the drop in Mainstay Moderate's long position.| Power Global vs. Voya Retirement Growth | Power Global vs. Transamerica Cleartrack Retirement | Power Global vs. Dimensional Retirement Income | Power Global vs. Blackrock Retirement Income |
| Mainstay Moderate vs. Touchstone Small Cap | Mainstay Moderate vs. Franklin Small Cap | Mainstay Moderate vs. Champlain Small | Mainstay Moderate vs. Transamerica International Small |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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