Correlation Between Legg Mason and Mainstay Retirement
Can any of the company-specific risk be diversified away by investing in both Legg Mason and Mainstay Retirement 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 Legg Mason and Mainstay Retirement into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Legg Mason Partners and Mainstay Retirement 2050, you can compare the effects of market volatilities on Legg Mason and Mainstay Retirement 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 Legg Mason with a short position of Mainstay Retirement. Check out your portfolio center. Please also check ongoing floating volatility patterns of Legg Mason and Mainstay Retirement.
Diversification Opportunities for Legg Mason and Mainstay Retirement
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Legg and Mainstay is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Legg Mason Partners and Mainstay Retirement 2050 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Retirement 2050 and Legg Mason 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 Legg Mason Partners are associated (or correlated) with Mainstay Retirement. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Retirement 2050 has no effect on the direction of Legg Mason i.e., Legg Mason and Mainstay Retirement go up and down completely randomly.
Pair Corralation between Legg Mason and Mainstay Retirement
If you would invest 96.00 in Legg Mason Partners on September 4, 2024 and sell it today you would earn a total of 4.00 from holding Legg Mason Partners or generate 4.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Legg Mason Partners vs. Mainstay Retirement 2050
Performance |
| Timeline |
| Legg Mason Partners |
| Mainstay Retirement 2050 |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Legg Mason and Mainstay Retirement Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Legg Mason and Mainstay Retirement
The main advantage of trading using opposite Legg Mason and Mainstay Retirement positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Legg Mason position performs unexpectedly, Mainstay Retirement 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 Retirement will offset losses from the drop in Mainstay Retirement's long position.| Legg Mason vs. Vanguard Total Stock | Legg Mason vs. Vanguard 500 Index | Legg Mason vs. Vanguard Total Stock | Legg Mason vs. Vanguard Total Stock |
| Mainstay Retirement vs. Calamos Market Neutral | Mainstay Retirement vs. Shelton Emerging Markets | Mainstay Retirement vs. Legg Mason Partners | Mainstay Retirement vs. Locorr Market Trend |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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