Correlation Between Mainstay Floating and Mainstay Mackay

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Can any of the company-specific risk be diversified away by investing in both Mainstay Floating 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 Floating 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 Floating Rate and Mainstay Mackay Infrastructure, you can compare the effects of market volatilities on Mainstay Floating 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 Floating with a short position of Mainstay Mackay. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mainstay Floating and Mainstay Mackay.

Diversification Opportunities for Mainstay Floating and Mainstay Mackay

-0.74
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between Mainstay and Mainstay is -0.74. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay Floating Rate and Mainstay Mackay Infrastructure in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Mackay Infr and Mainstay Floating 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 Floating Rate 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 Infr has no effect on the direction of Mainstay Floating i.e., Mainstay Floating and Mainstay Mackay go up and down completely randomly.

Pair Corralation between Mainstay Floating and Mainstay Mackay

Assuming the 90 days horizon Mainstay Floating Rate is expected to generate 0.42 times more return on investment than Mainstay Mackay. However, Mainstay Floating Rate is 2.39 times less risky than Mainstay Mackay. It trades about 0.23 of its potential returns per unit of risk. Mainstay Mackay Infrastructure is currently generating about 0.05 per unit of risk. If you would invest  740.00  in Mainstay Floating Rate on August 30, 2024 and sell it today you would earn a total of  150.00  from holding Mainstay Floating Rate or generate 20.27% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Mainstay Floating Rate  vs.  Mainstay Mackay Infrastructure

 Performance 
       Timeline  
Mainstay Floating Rate 

Risk-Adjusted Performance

22 of 100

 
Weak
 
Strong
Solid
Compared to the overall equity markets, risk-adjusted returns on investments in Mainstay Floating Rate are ranked lower than 22 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Mainstay Floating is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Mainstay Mackay Infr 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Mainstay Mackay Infrastructure has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong fundamental indicators, Mainstay Mackay is not utilizing all of its potentials. The latest stock price disturbance, may contribute to short-term losses for the investors.

Mainstay Floating and Mainstay Mackay Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Mainstay Floating and Mainstay Mackay

The main advantage of trading using opposite Mainstay Floating and Mainstay Mackay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mainstay Floating 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.
The idea behind Mainstay Floating Rate and Mainstay Mackay Infrastructure pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Bonds Directory module to find actively traded corporate debentures issued by US companies.

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