Correlation Between Blackrock Muniholdings and Mainstay Definedterm
Can any of the company-specific risk be diversified away by investing in both Blackrock Muniholdings and Mainstay Definedterm 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 Blackrock Muniholdings and Mainstay Definedterm into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Blackrock Muniholdings Closed and Mainstay Definedterm Muncipal, you can compare the effects of market volatilities on Blackrock Muniholdings and Mainstay Definedterm 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 Blackrock Muniholdings with a short position of Mainstay Definedterm. Check out your portfolio center. Please also check ongoing floating volatility patterns of Blackrock Muniholdings and Mainstay Definedterm.
Diversification Opportunities for Blackrock Muniholdings and Mainstay Definedterm
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Blackrock and Mainstay is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Blackrock Muniholdings Closed and Mainstay Definedterm Muncipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Definedterm and Blackrock Muniholdings 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 Blackrock Muniholdings Closed are associated (or correlated) with Mainstay Definedterm. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Definedterm has no effect on the direction of Blackrock Muniholdings i.e., Blackrock Muniholdings and Mainstay Definedterm go up and down completely randomly.
Pair Corralation between Blackrock Muniholdings and Mainstay Definedterm
Considering the 90-day investment horizon Blackrock Muniholdings Closed is expected to generate 1.03 times more return on investment than Mainstay Definedterm. However, Blackrock Muniholdings is 1.03 times more volatile than Mainstay Definedterm Muncipal. It trades about 0.06 of its potential returns per unit of risk. Mainstay Definedterm Muncipal is currently generating about 0.01 per unit of risk. If you would invest 1,113 in Blackrock Muniholdings Closed on November 9, 2024 and sell it today you would earn a total of 104.00 from holding Blackrock Muniholdings Closed or generate 9.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Blackrock Muniholdings Closed vs. Mainstay Definedterm Muncipal
Performance |
| Timeline |
| Blackrock Muniholdings |
| Mainstay Definedterm |
Blackrock Muniholdings and Mainstay Definedterm Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Blackrock Muniholdings and Mainstay Definedterm
The main advantage of trading using opposite Blackrock Muniholdings and Mainstay Definedterm positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Blackrock Muniholdings position performs unexpectedly, Mainstay Definedterm 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 Definedterm will offset losses from the drop in Mainstay Definedterm's long position.| Blackrock Muniholdings vs. John Hancock Income | Blackrock Muniholdings vs. MFS High Income | Blackrock Muniholdings vs. MFS Investment Grade | Blackrock Muniholdings vs. DTF Tax Free |
| Mainstay Definedterm vs. Blackrock Muniholdings Closed | Mainstay Definedterm vs. DTF Tax Free | Mainstay Definedterm vs. John Hancock Income | Mainstay Definedterm vs. MFS Investment Grade |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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