Correlation Between Mainstay Equity and Touchstone Large
Can any of the company-specific risk be diversified away by investing in both Mainstay Equity and Touchstone Large 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 Equity and Touchstone Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mainstay Equity Etf and Touchstone Large Cap, you can compare the effects of market volatilities on Mainstay Equity and Touchstone Large 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 Equity with a short position of Touchstone Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mainstay Equity and Touchstone Large.
Diversification Opportunities for Mainstay Equity and Touchstone Large
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Mainstay and Touchstone is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay Equity Etf and Touchstone Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Touchstone Large Cap and Mainstay Equity 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 Equity Etf are associated (or correlated) with Touchstone Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Touchstone Large Cap has no effect on the direction of Mainstay Equity i.e., Mainstay Equity and Touchstone Large go up and down completely randomly.
Pair Corralation between Mainstay Equity and Touchstone Large
Assuming the 90 days horizon Mainstay Equity Etf is expected to generate 1.16 times more return on investment than Touchstone Large. However, Mainstay Equity is 1.16 times more volatile than Touchstone Large Cap. It trades about 0.08 of its potential returns per unit of risk. Touchstone Large Cap is currently generating about 0.08 per unit of risk. If you would invest 1,201 in Mainstay Equity Etf on September 4, 2024 and sell it today you would earn a total of 454.00 from holding Mainstay Equity Etf or generate 37.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mainstay Equity Etf vs. Touchstone Large Cap
Performance |
| Timeline |
| Mainstay Equity Etf |
| Touchstone Large Cap |
Mainstay Equity and Touchstone Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mainstay Equity and Touchstone Large
The main advantage of trading using opposite Mainstay Equity and Touchstone Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mainstay Equity position performs unexpectedly, Touchstone Large 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 Touchstone Large will offset losses from the drop in Touchstone Large's long position.| Mainstay Equity vs. Mainstay High Yield | Mainstay Equity vs. Mainstay Tax Free | Mainstay Equity vs. Mainstay Income Builder | Mainstay Equity vs. Mainstay Large Cap |
| Touchstone Large vs. Champlain Mid Cap | Touchstone Large vs. Pace Smallmedium Growth | Touchstone Large vs. Mid Cap Growth | Touchstone Large 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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