Correlation Between Mainstay Moderate and James Balanced
Can any of the company-specific risk be diversified away by investing in both Mainstay Moderate and James Balanced 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 Moderate and James Balanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mainstay Moderate Growth and James Balanced Golden, you can compare the effects of market volatilities on Mainstay Moderate and James Balanced 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 Moderate with a short position of James Balanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mainstay Moderate and James Balanced.
Diversification Opportunities for Mainstay Moderate and James Balanced
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Mainstay and James is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay Moderate Growth and James Balanced Golden in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on James Balanced Golden and Mainstay Moderate 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 Moderate Growth are associated (or correlated) with James Balanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of James Balanced Golden has no effect on the direction of Mainstay Moderate i.e., Mainstay Moderate and James Balanced go up and down completely randomly.
Pair Corralation between Mainstay Moderate and James Balanced
Assuming the 90 days horizon Mainstay Moderate Growth is expected to generate 1.47 times more return on investment than James Balanced. However, Mainstay Moderate is 1.47 times more volatile than James Balanced Golden. It trades about 0.17 of its potential returns per unit of risk. James Balanced Golden is currently generating about 0.14 per unit of risk. If you would invest 1,571 in Mainstay Moderate Growth on September 4, 2024 and sell it today you would earn a total of 94.00 from holding Mainstay Moderate Growth or generate 5.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mainstay Moderate Growth vs. James Balanced Golden
Performance |
| Timeline |
| Mainstay Moderate Growth |
| James Balanced Golden |
Mainstay Moderate and James Balanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mainstay Moderate and James Balanced
The main advantage of trading using opposite Mainstay Moderate and James Balanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mainstay Moderate position performs unexpectedly, James Balanced 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 James Balanced will offset losses from the drop in James Balanced's long position.| Mainstay Moderate vs. James Balanced Golden | Mainstay Moderate vs. Goldman Sachs Clean | Mainstay Moderate vs. Great West Goldman Sachs | Mainstay Moderate vs. Goldman Sachs Short |
| James Balanced vs. Permanent Portfolio Class | James Balanced vs. Berwyn Income Fund | James Balanced vs. Large Cap Fund | James Balanced vs. Westcore Plus Bond |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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