Correlation Between NYSE Composite and Mainstay Moderate
Can any of the company-specific risk be diversified away by investing in both NYSE Composite 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 NYSE Composite and Mainstay Moderate 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 Moderate Allocation, you can compare the effects of market volatilities on NYSE Composite 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 NYSE Composite with a short position of Mainstay Moderate. Check out your portfolio center. Please also check ongoing floating volatility patterns of NYSE Composite and Mainstay Moderate.
Diversification Opportunities for NYSE Composite and Mainstay Moderate
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between NYSE and Mainstay is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding NYSE Composite and Mainstay Moderate Allocation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Moderate 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 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 has no effect on the direction of NYSE Composite i.e., NYSE Composite and Mainstay Moderate go up and down completely randomly.
Pair Corralation between NYSE Composite and Mainstay Moderate
Assuming the 90 days trading horizon NYSE Composite is expected to generate 1.32 times more return on investment than Mainstay Moderate. However, NYSE Composite is 1.32 times more volatile than Mainstay Moderate Allocation. It trades about 0.24 of its potential returns per unit of risk. Mainstay Moderate Allocation is currently generating about 0.22 per unit of risk. If you would invest 1,954,967 in NYSE Composite on August 28, 2024 and sell it today you would earn a total of 67,069 from holding NYSE Composite or generate 3.43% 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 Moderate Allocation
Performance |
| Timeline |
NYSE Composite and Mainstay Moderate Volatility Contrast
Predicted Return Density |
| Returns |
NYSE Composite
Pair trading matchups for NYSE Composite
Mainstay Moderate Allocation
Pair trading matchups for Mainstay Moderate
Pair Trading with NYSE Composite and Mainstay Moderate
The main advantage of trading using opposite NYSE Composite and Mainstay Moderate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NYSE Composite 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.| NYSE Composite vs. Hooker Furniture | NYSE Composite vs. Hudson Pacific Properties | NYSE Composite vs. Canlan Ice Sports | NYSE Composite vs. Boston Properties |
| Mainstay Moderate vs. Mainstay High Yield | Mainstay Moderate vs. Mainstay Tax Free | Mainstay Moderate vs. Mainstay Income Builder | Mainstay Moderate vs. Mainstay Large Cap |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Other Complementary Tools
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |