Correlation Between Invesco Energy and Mainstay Floating
Can any of the company-specific risk be diversified away by investing in both Invesco Energy 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 Invesco Energy and Mainstay Floating into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Invesco Energy Fund and Mainstay Floating Rate, you can compare the effects of market volatilities on Invesco Energy 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 Invesco Energy with a short position of Mainstay Floating. Check out your portfolio center. Please also check ongoing floating volatility patterns of Invesco Energy and Mainstay Floating.
Diversification Opportunities for Invesco Energy and Mainstay Floating
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Invesco and Mainstay is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Invesco Energy Fund 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 Invesco Energy 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 Invesco Energy Fund 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 Invesco Energy i.e., Invesco Energy and Mainstay Floating go up and down completely randomly.
Pair Corralation between Invesco Energy and Mainstay Floating
Assuming the 90 days horizon Invesco Energy Fund is expected to under-perform the Mainstay Floating. In addition to that, Invesco Energy is 14.75 times more volatile than Mainstay Floating Rate. It trades about -0.11 of its total potential returns per unit of risk. Mainstay Floating Rate is currently generating about 0.18 per unit of volatility. If you would invest 889.00 in Mainstay Floating Rate on September 12, 2024 and sell it today you would earn a total of 2.00 from holding Mainstay Floating Rate or generate 0.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Invesco Energy Fund vs. Mainstay Floating Rate
Performance |
| Timeline |
| Invesco Energy |
| Mainstay Floating Rate |
Invesco Energy and Mainstay Floating Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Invesco Energy and Mainstay Floating
The main advantage of trading using opposite Invesco Energy and Mainstay Floating positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Invesco Energy 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.| Invesco Energy vs. Vanguard Energy Fund | Invesco Energy vs. Vanguard Energy Index | Invesco Energy vs. Fidelity Select Portfolios | Invesco Energy vs. Fidelity Advisor Energy |
| Mainstay Floating vs. Dreyfus Government Cash | Mainstay Floating vs. Aig Government Money | Mainstay Floating vs. Ridgeworth Seix Government | Mainstay Floating vs. Prudential Government Income |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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