Correlation Between Mainstay New and Mainstay Mackay
Can any of the company-specific risk be diversified away by investing in both Mainstay New and Mainstay Mackay 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 New and Mainstay Mackay into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mainstay New York and Mainstay Mackay Strategic, you can compare the effects of market volatilities on Mainstay New and Mainstay Mackay 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 New with a short position of Mainstay Mackay. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mainstay New and Mainstay Mackay.
Diversification Opportunities for Mainstay New and Mainstay Mackay
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Mainstay and Mainstay is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay New York and Mainstay Mackay Strategic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Mackay Strategic and Mainstay New 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 New York are associated (or correlated) with Mainstay Mackay. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Mackay Strategic has no effect on the direction of Mainstay New i.e., Mainstay New and Mainstay Mackay go up and down completely randomly.
Pair Corralation between Mainstay New and Mainstay Mackay
Assuming the 90 days horizon Mainstay New York is expected to generate 1.64 times more return on investment than Mainstay Mackay. However, Mainstay New is 1.64 times more volatile than Mainstay Mackay Strategic. It trades about 0.22 of its potential returns per unit of risk. Mainstay Mackay Strategic is currently generating about 0.24 per unit of risk. If you would invest 959.00 in Mainstay New York on August 30, 2024 and sell it today you would earn a total of 17.00 from holding Mainstay New York or generate 1.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mainstay New York vs. Mainstay Mackay Strategic
Performance |
| Timeline |
| Mainstay New York |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Modest
| Mainstay Mackay Strategic |
Mainstay New and Mainstay Mackay Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mainstay New and Mainstay Mackay
The main advantage of trading using opposite Mainstay New and Mainstay Mackay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mainstay New position performs unexpectedly, Mainstay Mackay 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 Mackay will offset losses from the drop in Mainstay Mackay's long position.| Mainstay New vs. Ab Bond Inflation | Mainstay New vs. Goldman Sachs Inflation | Mainstay New vs. Aqr Managed Futures | Mainstay New vs. Ab Bond Inflation |
| Mainstay Mackay vs. Vanguard Intermediate Term Tax Exempt | Mainstay Mackay vs. Vanguard Intermediate Term Tax Exempt | Mainstay Mackay vs. Tax Exempt Bond | Mainstay Mackay vs. Tax Exempt 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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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