Correlation Between Mainstay Unconstrained and Mainstay Mackay
Can any of the company-specific risk be diversified away by investing in both Mainstay Unconstrained 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 Unconstrained 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 Unconstrained Bond and Mainstay Mackay Strategic, you can compare the effects of market volatilities on Mainstay Unconstrained 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 Unconstrained with a short position of Mainstay Mackay. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mainstay Unconstrained and Mainstay Mackay.
Diversification Opportunities for Mainstay Unconstrained and Mainstay Mackay
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Mainstay and Mainstay is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay Unconstrained Bond 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 Unconstrained 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 Unconstrained Bond 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 Unconstrained i.e., Mainstay Unconstrained and Mainstay Mackay go up and down completely randomly.
Pair Corralation between Mainstay Unconstrained and Mainstay Mackay
Assuming the 90 days horizon Mainstay Unconstrained Bond is expected to generate 1.61 times more return on investment than Mainstay Mackay. However, Mainstay Unconstrained is 1.61 times more volatile than Mainstay Mackay Strategic. It trades about 0.13 of its potential returns per unit of risk. Mainstay Mackay Strategic is currently generating about 0.15 per unit of risk. If you would invest 836.00 in Mainstay Unconstrained Bond on August 28, 2024 and sell it today you would earn a total of 40.00 from holding Mainstay Unconstrained Bond or generate 4.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mainstay Unconstrained Bond vs. Mainstay Mackay Strategic
Performance |
| Timeline |
| Mainstay Unconstrained |
| Mainstay Mackay Strategic |
Mainstay Unconstrained and Mainstay Mackay Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mainstay Unconstrained and Mainstay Mackay
The main advantage of trading using opposite Mainstay Unconstrained and Mainstay Mackay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mainstay Unconstrained 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 Unconstrained vs. Mainstay Large Cap | Mainstay Unconstrained vs. Mainstay Large Cap | Mainstay Unconstrained vs. Mainstay Large Cap | Mainstay Unconstrained vs. Mainstay Moderate Allocation |
| Mainstay Mackay vs. Blackrock Moderate Prepared | Mainstay Mackay vs. Pgim Conservative Retirement | Mainstay Mackay vs. Dimensional Retirement Income | Mainstay Mackay vs. Transamerica Cleartrack Retirement |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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