Correlation Between Great-west and Mainstay Moderate
Can any of the company-specific risk be diversified away by investing in both Great-west and Mainstay Moderate 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 Great-west and Mainstay Moderate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Great West Government Mortgage and Mainstay Moderate Growth, you can compare the effects of market volatilities on Great-west and Mainstay Moderate 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 Great-west with a short position of Mainstay Moderate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Great-west and Mainstay Moderate.
Diversification Opportunities for Great-west and Mainstay Moderate
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Great-west and Mainstay is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding Great West Government Mortgage and Mainstay Moderate Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Moderate Growth and Great-west 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 Great West Government Mortgage are associated (or correlated) with Mainstay Moderate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Moderate Growth has no effect on the direction of Great-west i.e., Great-west and Mainstay Moderate go up and down completely randomly.
Pair Corralation between Great-west and Mainstay Moderate
Assuming the 90 days horizon Great West Government Mortgage is expected to under-perform the Mainstay Moderate. But the mutual fund apears to be less risky and, when comparing its historical volatility, Great West Government Mortgage is 1.87 times less risky than Mainstay Moderate. The mutual fund trades about -0.08 of its potential returns per unit of risk. The Mainstay Moderate Growth is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 1,642 in Mainstay Moderate Growth on August 24, 2024 and sell it today you would earn a total of 37.00 from holding Mainstay Moderate Growth or generate 2.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Great West Government Mortgage vs. Mainstay Moderate Growth
Performance |
| Timeline |
| Great West Government |
| Mainstay Moderate Growth |
Great-west and Mainstay Moderate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Great-west and Mainstay Moderate
The main advantage of trading using opposite Great-west and Mainstay Moderate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Great-west position performs unexpectedly, Mainstay Moderate 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 Moderate will offset losses from the drop in Mainstay Moderate's long position.| Great-west vs. Gmo Equity Allocation | Great-west vs. Artisan Select Equity | Great-west vs. Cutler Equity | Great-west vs. Dreyfusstandish Global Fixed |
| Mainstay Moderate vs. Falcon Focus Scv | Mainstay Moderate vs. Qs Large Cap | Mainstay Moderate vs. Rbc Microcap Value | Mainstay Moderate vs. Aam Select 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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