Correlation Between Mainstay Balanced and Sprott Gold
Can any of the company-specific risk be diversified away by investing in both Mainstay Balanced and Sprott Gold 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 Balanced and Sprott Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mainstay Balanced Fund and Sprott Gold Equity, you can compare the effects of market volatilities on Mainstay Balanced and Sprott Gold 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 Balanced with a short position of Sprott Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mainstay Balanced and Sprott Gold.
Diversification Opportunities for Mainstay Balanced and Sprott Gold
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Mainstay and Sprott is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay Balanced Fund and Sprott Gold Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sprott Gold Equity and Mainstay Balanced 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 Balanced Fund are associated (or correlated) with Sprott Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sprott Gold Equity has no effect on the direction of Mainstay Balanced i.e., Mainstay Balanced and Sprott Gold go up and down completely randomly.
Pair Corralation between Mainstay Balanced and Sprott Gold
Assuming the 90 days horizon Mainstay Balanced Fund is expected to generate 0.26 times more return on investment than Sprott Gold. However, Mainstay Balanced Fund is 3.84 times less risky than Sprott Gold. It trades about 0.32 of its potential returns per unit of risk. Sprott Gold Equity is currently generating about -0.16 per unit of risk. If you would invest 3,133 in Mainstay Balanced Fund on September 1, 2024 and sell it today you would earn a total of 109.00 from holding Mainstay Balanced Fund or generate 3.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Mainstay Balanced Fund vs. Sprott Gold Equity
Performance |
| Timeline |
| Mainstay Balanced |
| Sprott Gold Equity |
Mainstay Balanced and Sprott Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mainstay Balanced and Sprott Gold
The main advantage of trading using opposite Mainstay Balanced and Sprott Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mainstay Balanced position performs unexpectedly, Sprott Gold 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 Sprott Gold will offset losses from the drop in Sprott Gold's long position.| Mainstay Balanced vs. Sprott Gold Equity | Mainstay Balanced vs. Europac Gold Fund | Mainstay Balanced vs. Goldman Sachs Esg | Mainstay Balanced vs. Great West Goldman Sachs |
| Sprott Gold vs. Sprott Junior Gold | Sprott Gold vs. Sprott Gold Miners | Sprott Gold vs. Europac Gold Fund | Sprott Gold vs. US Global GO |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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