Correlation Between Mainstay High and Mainstay Map
Can any of the company-specific risk be diversified away by investing in both Mainstay High and Mainstay Map 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 High and Mainstay Map into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mainstay High Yield and Mainstay Map Equity, you can compare the effects of market volatilities on Mainstay High and Mainstay Map 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 High with a short position of Mainstay Map. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mainstay High and Mainstay Map.
Diversification Opportunities for Mainstay High and Mainstay Map
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Mainstay and Mainstay is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay High Yield and Mainstay Map Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Map Equity and Mainstay High 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 High Yield are associated (or correlated) with Mainstay Map. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Map Equity has no effect on the direction of Mainstay High i.e., Mainstay High and Mainstay Map go up and down completely randomly.
Pair Corralation between Mainstay High and Mainstay Map
Assuming the 90 days horizon Mainstay High is expected to generate 6.27 times less return on investment than Mainstay Map. But when comparing it to its historical volatility, Mainstay High Yield is 6.14 times less risky than Mainstay Map. It trades about 0.19 of its potential returns per unit of risk. Mainstay Map Equity is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 3,169 in Mainstay Map Equity on August 29, 2024 and sell it today you would earn a total of 119.00 from holding Mainstay Map Equity or generate 3.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Mainstay High Yield vs. Mainstay Map Equity
Performance |
| Timeline |
| Mainstay High Yield |
| Mainstay Map Equity |
Mainstay High and Mainstay Map Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mainstay High and Mainstay Map
The main advantage of trading using opposite Mainstay High and Mainstay Map positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mainstay High position performs unexpectedly, Mainstay Map 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 Map will offset losses from the drop in Mainstay Map's long position.| Mainstay High vs. Prudential High Yield | Mainstay High vs. HUMANA INC | Mainstay High vs. Aquagold International | Mainstay High vs. Barloworld Ltd ADR |
| Mainstay Map vs. Touchstone International Equity | Mainstay Map vs. Ms Global Fixed | Mainstay Map vs. Balanced Fund Retail | Mainstay Map vs. Vanguard Equity Income |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. |