Correlation Between Mainstay Convertible and Leader Short-term
Can any of the company-specific risk be diversified away by investing in both Mainstay Convertible and Leader Short-term 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 Convertible and Leader Short-term into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mainstay Vertible Fund and Leader Short Term Bond, you can compare the effects of market volatilities on Mainstay Convertible and Leader Short-term 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 Convertible with a short position of Leader Short-term. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mainstay Convertible and Leader Short-term.
Diversification Opportunities for Mainstay Convertible and Leader Short-term
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Mainstay and Leader is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay Vertible Fund and Leader Short Term Bond in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Leader Short Term and Mainstay Convertible 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 Vertible Fund are associated (or correlated) with Leader Short-term. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Leader Short Term has no effect on the direction of Mainstay Convertible i.e., Mainstay Convertible and Leader Short-term go up and down completely randomly.
Pair Corralation between Mainstay Convertible and Leader Short-term
Assuming the 90 days horizon Mainstay Vertible Fund is expected to under-perform the Leader Short-term. In addition to that, Mainstay Convertible is 2.65 times more volatile than Leader Short Term Bond. It trades about -0.13 of its total potential returns per unit of risk. Leader Short Term Bond is currently generating about 0.07 per unit of volatility. If you would invest 823.00 in Leader Short Term Bond on October 30, 2024 and sell it today you would earn a total of 5.00 from holding Leader Short Term Bond or generate 0.61% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mainstay Vertible Fund vs. Leader Short Term Bond
Performance |
| Timeline |
| Mainstay Convertible |
| Leader Short Term |
Mainstay Convertible and Leader Short-term Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mainstay Convertible and Leader Short-term
The main advantage of trading using opposite Mainstay Convertible and Leader Short-term positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mainstay Convertible position performs unexpectedly, Leader Short-term 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 Leader Short-term will offset losses from the drop in Leader Short-term's long position.| Mainstay Convertible vs. Mainstay High Yield | Mainstay Convertible vs. Mainstay Income Builder | Mainstay Convertible vs. Mainstay Sp 500 | Mainstay Convertible vs. Mainstay Large Cap |
| Leader Short-term vs. Chestnut Street Exchange | Leader Short-term vs. Franklin Government Money | Leader Short-term vs. Prudential Government Money | Leader Short-term vs. Edward Jones Money |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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