Correlation Between Mainstay High and Maryland Short-term
Can any of the company-specific risk be diversified away by investing in both Mainstay High and Maryland 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 High and Maryland Short-term 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 Maryland Short Term Tax Free, you can compare the effects of market volatilities on Mainstay High and Maryland 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 High with a short position of Maryland Short-term. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mainstay High and Maryland Short-term.
Diversification Opportunities for Mainstay High and Maryland Short-term
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Mainstay and Maryland is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay High Yield and Maryland Short Term Tax Free in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Maryland Short Term 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 Maryland 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 Maryland Short Term has no effect on the direction of Mainstay High i.e., Mainstay High and Maryland Short-term go up and down completely randomly.
Pair Corralation between Mainstay High and Maryland Short-term
Assuming the 90 days horizon Mainstay High Yield is expected to generate 3.25 times more return on investment than Maryland Short-term. However, Mainstay High is 3.25 times more volatile than Maryland Short Term Tax Free. It trades about 0.2 of its potential returns per unit of risk. Maryland Short Term Tax Free is currently generating about 0.15 per unit of risk. If you would invest 1,192 in Mainstay High Yield on September 2, 2024 and sell it today you would earn a total of 20.00 from holding Mainstay High Yield or generate 1.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mainstay High Yield vs. Maryland Short Term Tax Free
Performance |
| Timeline |
| Mainstay High Yield |
| Maryland Short Term |
Mainstay High and Maryland Short-term Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mainstay High and Maryland Short-term
The main advantage of trading using opposite Mainstay High and Maryland Short-term positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mainstay High position performs unexpectedly, Maryland 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 Maryland Short-term will offset losses from the drop in Maryland Short-term's long position.| Mainstay High vs. Maryland Short Term Tax Free | Mainstay High vs. The Short Term | Mainstay High vs. Aqr Long Short Equity | Mainstay High vs. Ab Select Longshort |
| Maryland Short-term vs. Maryland Tax Free Bond | Maryland Short-term vs. Georgia Tax Free Bond | Maryland Short-term vs. New York Tax Free | Maryland Short-term vs. T Rowe Price |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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