Correlation Between Mainstay International and Oil Gas
Can any of the company-specific risk be diversified away by investing in both Mainstay International and Oil Gas 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 International and Oil Gas into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mainstay International Opportunities and Oil Gas Ultrasector, you can compare the effects of market volatilities on Mainstay International and Oil Gas 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 International with a short position of Oil Gas. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mainstay International and Oil Gas.
Diversification Opportunities for Mainstay International and Oil Gas
-0.35 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Mainstay and Oil is -0.35. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay International Opportu and Oil Gas Ultrasector in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oil Gas Ultrasector and Mainstay International 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 International Opportunities are associated (or correlated) with Oil Gas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oil Gas Ultrasector has no effect on the direction of Mainstay International i.e., Mainstay International and Oil Gas go up and down completely randomly.
Pair Corralation between Mainstay International and Oil Gas
Assuming the 90 days horizon Mainstay International Opportunities is expected to generate 0.38 times more return on investment than Oil Gas. However, Mainstay International Opportunities is 2.65 times less risky than Oil Gas. It trades about 0.16 of its potential returns per unit of risk. Oil Gas Ultrasector is currently generating about -0.24 per unit of risk. If you would invest 773.00 in Mainstay International Opportunities on September 14, 2024 and sell it today you would earn a total of 13.00 from holding Mainstay International Opportunities or generate 1.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mainstay International Opportu vs. Oil Gas Ultrasector
Performance |
| Timeline |
| Mainstay International |
| Oil Gas Ultrasector |
Mainstay International and Oil Gas Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mainstay International and Oil Gas
The main advantage of trading using opposite Mainstay International and Oil Gas positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mainstay International position performs unexpectedly, Oil Gas 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 Oil Gas will offset losses from the drop in Oil Gas' long position.| Mainstay International vs. Oil Gas Ultrasector | Mainstay International vs. World Energy Fund | Mainstay International vs. Short Oil Gas | Mainstay International vs. Clearbridge Energy Mlp |
| Oil Gas vs. Oil Gas Ultrasector | Oil Gas vs. Ultramid Cap Profund Ultramid Cap | Oil Gas vs. Precious Metals Ultrasector | Oil Gas vs. Real Estate Ultrasector |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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