Correlation Between Mainstay Epoch and Grandeur Peak
Can any of the company-specific risk be diversified away by investing in both Mainstay Epoch and Grandeur Peak 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 Mainstay Epoch and Grandeur Peak into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mainstay Epoch International and Grandeur Peak Global, you can compare the effects of market volatilities on Mainstay Epoch and Grandeur Peak 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 Mainstay Epoch with a short position of Grandeur Peak. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mainstay Epoch and Grandeur Peak.
Diversification Opportunities for Mainstay Epoch and Grandeur Peak
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Mainstay and Grandeur is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay Epoch International and Grandeur Peak Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grandeur Peak Global and Mainstay Epoch 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 Mainstay Epoch International are associated (or correlated) with Grandeur Peak. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grandeur Peak Global has no effect on the direction of Mainstay Epoch i.e., Mainstay Epoch and Grandeur Peak go up and down completely randomly.
Pair Corralation between Mainstay Epoch and Grandeur Peak
Assuming the 90 days horizon Mainstay Epoch International is expected to under-perform the Grandeur Peak. But the mutual fund apears to be less risky and, when comparing its historical volatility, Mainstay Epoch International is 1.06 times less risky than Grandeur Peak. The mutual fund trades about -0.11 of its potential returns per unit of risk. The Grandeur Peak Global is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 345.00 in Grandeur Peak Global on September 3, 2024 and sell it today you would earn a total of 4.00 from holding Grandeur Peak Global or generate 1.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mainstay Epoch International vs. Grandeur Peak Global
Performance |
| Timeline |
| Mainstay Epoch Inter |
| Grandeur Peak Global |
Mainstay Epoch and Grandeur Peak Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mainstay Epoch and Grandeur Peak
The main advantage of trading using opposite Mainstay Epoch and Grandeur Peak positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mainstay Epoch position performs unexpectedly, Grandeur Peak 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 Grandeur Peak will offset losses from the drop in Grandeur Peak's long position.| Mainstay Epoch vs. Mainstay Sp 500 | Mainstay Epoch vs. Mainstay Balanced Fund | Mainstay Epoch vs. Mainstay Balanced Fund |
| Grandeur Peak vs. American Funds Smallcap | Grandeur Peak vs. American Fds Smallcap | Grandeur Peak vs. Smallcap World Fund | Grandeur Peak vs. Smallcap World Fund |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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