Correlation Between Mainstay Growth and Invesco Energy
Can any of the company-specific risk be diversified away by investing in both Mainstay Growth and Invesco Energy 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 Growth and Invesco Energy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mainstay Growth Etf and Invesco Energy Fund, you can compare the effects of market volatilities on Mainstay Growth and Invesco Energy 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 Growth with a short position of Invesco Energy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mainstay Growth and Invesco Energy.
Diversification Opportunities for Mainstay Growth and Invesco Energy
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Mainstay and Invesco is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay Growth Etf and Invesco Energy Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invesco Energy and Mainstay Growth 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 Growth Etf are associated (or correlated) with Invesco Energy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invesco Energy has no effect on the direction of Mainstay Growth i.e., Mainstay Growth and Invesco Energy go up and down completely randomly.
Pair Corralation between Mainstay Growth and Invesco Energy
Assuming the 90 days horizon Mainstay Growth Etf is expected to generate 0.48 times more return on investment than Invesco Energy. However, Mainstay Growth Etf is 2.1 times less risky than Invesco Energy. It trades about 0.09 of its potential returns per unit of risk. Invesco Energy Fund is currently generating about -0.08 per unit of risk. If you would invest 1,489 in Mainstay Growth Etf on September 13, 2024 and sell it today you would earn a total of 11.00 from holding Mainstay Growth Etf or generate 0.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mainstay Growth Etf vs. Invesco Energy Fund
Performance |
| Timeline |
| Mainstay Growth Etf |
| Invesco Energy |
Mainstay Growth and Invesco Energy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mainstay Growth and Invesco Energy
The main advantage of trading using opposite Mainstay Growth and Invesco Energy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mainstay Growth position performs unexpectedly, Invesco Energy 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 Invesco Energy will offset losses from the drop in Invesco Energy's long position.| Mainstay Growth vs. Shelton Emerging Markets | Mainstay Growth vs. Black Oak Emerging | Mainstay Growth vs. Vy Jpmorgan Emerging | Mainstay Growth vs. Pnc Emerging Markets |
| Invesco Energy vs. Us Government Securities | Invesco Energy vs. Payden Government Fund | Invesco Energy vs. Intermediate Government Bond | Invesco Energy vs. Prudential Government 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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