Correlation Between Mainstay Tax and Fidelity Advisor
Can any of the company-specific risk be diversified away by investing in both Mainstay Tax and Fidelity Advisor 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 Tax and Fidelity Advisor into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mainstay Tax Advantaged and Fidelity Advisor Real, you can compare the effects of market volatilities on Mainstay Tax and Fidelity Advisor 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 Tax with a short position of Fidelity Advisor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mainstay Tax and Fidelity Advisor.
Diversification Opportunities for Mainstay Tax and Fidelity Advisor
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Mainstay and Fidelity is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay Tax Advantaged and Fidelity Advisor Real in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Advisor Real and Mainstay Tax 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 Tax Advantaged are associated (or correlated) with Fidelity Advisor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Advisor Real has no effect on the direction of Mainstay Tax i.e., Mainstay Tax and Fidelity Advisor go up and down completely randomly.
Pair Corralation between Mainstay Tax and Fidelity Advisor
Assuming the 90 days horizon Mainstay Tax is expected to generate 6.19 times less return on investment than Fidelity Advisor. But when comparing it to its historical volatility, Mainstay Tax Advantaged is 9.57 times less risky than Fidelity Advisor. It trades about 0.17 of its potential returns per unit of risk. Fidelity Advisor Real is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,425 in Fidelity Advisor Real on September 1, 2024 and sell it today you would earn a total of 486.00 from holding Fidelity Advisor Real or generate 34.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mainstay Tax Advantaged vs. Fidelity Advisor Real
Performance |
| Timeline |
| Mainstay Tax Advantaged |
| Fidelity Advisor Real |
Mainstay Tax and Fidelity Advisor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mainstay Tax and Fidelity Advisor
The main advantage of trading using opposite Mainstay Tax and Fidelity Advisor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mainstay Tax position performs unexpectedly, Fidelity Advisor 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 Fidelity Advisor will offset losses from the drop in Fidelity Advisor's long position.| Mainstay Tax vs. Mainstay High Yield | Mainstay Tax vs. Mainstay Tax Free | Mainstay Tax vs. Mainstay Income Builder | Mainstay Tax vs. Mainstay Large Cap |
| Fidelity Advisor vs. Fidelity Zero International | Fidelity Advisor vs. Fidelity Emerging Markets | Fidelity Advisor vs. Fidelity Zero Total | Fidelity Advisor vs. Fidelity International Index |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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