Correlation Between Oklahoma Municipal and Mainstay
Can any of the company-specific risk be diversified away by investing in both Oklahoma Municipal and Mainstay 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 Oklahoma Municipal and Mainstay into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Oklahoma Municipal Fund and Mainstay Sp 500, you can compare the effects of market volatilities on Oklahoma Municipal and Mainstay 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 Oklahoma Municipal with a short position of Mainstay. Check out your portfolio center. Please also check ongoing floating volatility patterns of Oklahoma Municipal and Mainstay.
Diversification Opportunities for Oklahoma Municipal and Mainstay
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Oklahoma and Mainstay is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Oklahoma Municipal Fund and Mainstay Sp 500 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Sp 500 and Oklahoma Municipal 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 Oklahoma Municipal Fund are associated (or correlated) with Mainstay. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Sp 500 has no effect on the direction of Oklahoma Municipal i.e., Oklahoma Municipal and Mainstay go up and down completely randomly.
Pair Corralation between Oklahoma Municipal and Mainstay
Assuming the 90 days horizon Oklahoma Municipal is expected to generate 4.38 times less return on investment than Mainstay. But when comparing it to its historical volatility, Oklahoma Municipal Fund is 3.48 times less risky than Mainstay. It trades about 0.1 of its potential returns per unit of risk. Mainstay Sp 500 is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 5,935 in Mainstay Sp 500 on September 3, 2024 and sell it today you would earn a total of 770.00 from holding Mainstay Sp 500 or generate 12.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Oklahoma Municipal Fund vs. Mainstay Sp 500
Performance |
| Timeline |
| Oklahoma Municipal |
| Mainstay Sp 500 |
Oklahoma Municipal and Mainstay Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Oklahoma Municipal and Mainstay
The main advantage of trading using opposite Oklahoma Municipal and Mainstay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Oklahoma Municipal position performs unexpectedly, Mainstay 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 will offset losses from the drop in Mainstay's long position.| Oklahoma Municipal vs. Limited Term Tax | Oklahoma Municipal vs. Calvert Short Duration | Oklahoma Municipal vs. Federated Short Term Income | Oklahoma Municipal vs. Jhancock Short Duration |
| Mainstay vs. Vanguard Total Stock | Mainstay vs. Vanguard 500 Index | Mainstay vs. Vanguard Total Stock | Mainstay vs. Vanguard Total Stock |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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