Correlation Between Mainstay Map and First American
Can any of the company-specific risk be diversified away by investing in both Mainstay Map and First American 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 Map and First American into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mainstay Map Equity and First American Funds, you can compare the effects of market volatilities on Mainstay Map and First American 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 Map with a short position of First American. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mainstay Map and First American.
Diversification Opportunities for Mainstay Map and First American
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Mainstay and First is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay Map Equity and First American Funds in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First American Funds and Mainstay Map 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 Map Equity are associated (or correlated) with First American. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First American Funds has no effect on the direction of Mainstay Map i.e., Mainstay Map and First American go up and down completely randomly.
Pair Corralation between Mainstay Map and First American
Assuming the 90 days horizon Mainstay Map Equity is expected to generate 5.6 times more return on investment than First American. However, Mainstay Map is 5.6 times more volatile than First American Funds. It trades about 0.14 of its potential returns per unit of risk. First American Funds is currently generating about 0.13 per unit of risk. If you would invest 2,880 in Mainstay Map Equity on September 5, 2024 and sell it today you would earn a total of 377.00 from holding Mainstay Map Equity or generate 13.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.2% |
| Values | Daily Returns |
Mainstay Map Equity vs. First American Funds
Performance |
| Timeline |
| Mainstay Map Equity |
| First American Funds |
Mainstay Map and First American Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mainstay Map and First American
The main advantage of trading using opposite Mainstay Map and First American positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mainstay Map position performs unexpectedly, First American 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 First American will offset losses from the drop in First American's long position.| Mainstay Map vs. Transamerica Financial Life | Mainstay Map vs. Davis Financial Fund | Mainstay Map vs. 1919 Financial Services | Mainstay Map vs. Blackrock Financial Institutions |
| First American vs. Iaadx | First American vs. Ab Value Fund | First American vs. T Rowe Price | First American vs. Balanced Fund Investor |
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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