Correlation Between NYSE Composite and Mainstay Vertible
Can any of the company-specific risk be diversified away by investing in both NYSE Composite and Mainstay Vertible 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 NYSE Composite and Mainstay Vertible into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NYSE Composite and Mainstay Vertible Fund, you can compare the effects of market volatilities on NYSE Composite and Mainstay Vertible 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 NYSE Composite with a short position of Mainstay Vertible. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Mainstay Vertible.
Diversification Opportunities for NYSE Composite and Mainstay Vertible
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between NYSE and Mainstay is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Mainstay Vertible Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Vertible and NYSE Composite 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 NYSE Composite are associated (or correlated) with Mainstay Vertible. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Vertible has no effect on the direction of NYSE Composite i.e., NYSE Composite and Mainstay Vertible go up and down completely randomly.
Pair Corralation between NYSE Composite and Mainstay Vertible
Assuming the 90 days trading horizon NYSE Composite is expected to generate 1.5 times more return on investment than Mainstay Vertible. However, NYSE Composite is 1.5 times more volatile than Mainstay Vertible Fund. It trades about 0.04 of its potential returns per unit of risk. Mainstay Vertible Fund is currently generating about 0.04 per unit of risk. If you would invest 1,554,588 in NYSE Composite on January 17, 2025 and sell it today you would earn a total of 269,977 from holding NYSE Composite or generate 17.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
NYSE Composite vs. Mainstay Vertible Fund
Performance |
| Timeline |
NYSE Composite and Mainstay Vertible Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Mainstay Vertible Fund
Pair trading matchups for Mainstay Vertible
Pair Trading with NYSE Composite and Mainstay Vertible
The main advantage of trading using opposite NYSE Composite and Mainstay Vertible positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite position performs unexpectedly, Mainstay Vertible 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 Vertible will offset losses from the drop in Mainstay Vertible's long position.| NYSE Composite vs. Perseus Mining Limited | NYSE Composite vs. Copperbank Resources Corp | NYSE Composite vs. Catalyst Metals Limited | NYSE Composite vs. Life Time Group |
| Mainstay Vertible vs. Franklin Vertible Securities | Mainstay Vertible vs. Mainstay Floating Rate | Mainstay Vertible vs. Calamos Vertible Fund | Mainstay Vertible vs. Mainstay High Yield |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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