Correlation Between Mainstay Large and American Century
Can any of the company-specific risk be diversified away by investing in both Mainstay Large and American Century 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 Large and American Century into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mainstay Large Cap and American Century One, you can compare the effects of market volatilities on Mainstay Large and American Century 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 Large with a short position of American Century. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mainstay Large and American Century.
Diversification Opportunities for Mainstay Large and American Century
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Mainstay and American is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay Large Cap and American Century One in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on American Century One and Mainstay Large 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 Large Cap are associated (or correlated) with American Century. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of American Century One has no effect on the direction of Mainstay Large i.e., Mainstay Large and American Century go up and down completely randomly.
Pair Corralation between Mainstay Large and American Century
Assuming the 90 days horizon Mainstay Large Cap is expected to generate 1.7 times more return on investment than American Century. However, Mainstay Large is 1.7 times more volatile than American Century One. It trades about 0.08 of its potential returns per unit of risk. American Century One is currently generating about 0.09 per unit of risk. If you would invest 714.00 in Mainstay Large Cap on August 30, 2024 and sell it today you would earn a total of 432.00 from holding Mainstay Large Cap or generate 60.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mainstay Large Cap vs. American Century One
Performance |
| Timeline |
| Mainstay Large Cap |
| American Century One |
Mainstay Large and American Century Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mainstay Large and American Century
The main advantage of trading using opposite Mainstay Large and American Century positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mainstay Large position performs unexpectedly, American Century 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 American Century will offset losses from the drop in American Century's long position.| Mainstay Large vs. Growth Fund Of | Mainstay Large vs. HUMANA INC | Mainstay Large vs. Aquagold International | Mainstay Large vs. Barloworld Ltd ADR |
| American Century vs. Fidelity Advisor Gold | American Century vs. Great West Goldman Sachs | American Century vs. Global Gold Fund | American Century vs. Gold And Precious |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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