Correlation Between Virtus High and Mainstay Total
Can any of the company-specific risk be diversified away by investing in both Virtus High and Mainstay Total 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 Virtus High and Mainstay Total into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Virtus High Yield and Mainstay Total Return, you can compare the effects of market volatilities on Virtus High and Mainstay Total 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 Virtus High with a short position of Mainstay Total. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus High and Mainstay Total.
Diversification Opportunities for Virtus High and Mainstay Total
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Virtus and Mainstay is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding Virtus High Yield and Mainstay Total Return in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Total Return and Virtus High 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 Virtus High Yield are associated (or correlated) with Mainstay Total. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Total Return has no effect on the direction of Virtus High i.e., Virtus High and Mainstay Total go up and down completely randomly.
Pair Corralation between Virtus High and Mainstay Total
Assuming the 90 days horizon Virtus High is expected to generate 1.39 times less return on investment than Mainstay Total. But when comparing it to its historical volatility, Virtus High Yield is 2.33 times less risky than Mainstay Total. It trades about 0.18 of its potential returns per unit of risk. Mainstay Total Return is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 921.00 in Mainstay Total Return on September 4, 2024 and sell it today you would earn a total of 7.00 from holding Mainstay Total Return or generate 0.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Virtus High Yield vs. Mainstay Total Return
Performance |
| Timeline |
| Virtus High Yield |
| Mainstay Total Return |
Virtus High and Mainstay Total Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Virtus High and Mainstay Total
The main advantage of trading using opposite Virtus High and Mainstay Total positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virtus High position performs unexpectedly, Mainstay Total 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 Total will offset losses from the drop in Mainstay Total's long position.| Virtus High vs. Alger Health Sciences | Virtus High vs. Fidelity Advisor Health | Virtus High vs. Baron Health Care | Virtus High vs. Deutsche Health And |
| Mainstay Total vs. Fidelity Sai Convertible | Mainstay Total vs. Calamos Dynamic Convertible | Mainstay Total vs. Rationalpier 88 Convertible | Mainstay Total vs. Lord Abbett Convertible |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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