Correlation Between Jennison Natural and Mainstay Large
Can any of the company-specific risk be diversified away by investing in both Jennison Natural and Mainstay Large 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 Jennison Natural and Mainstay Large into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Jennison Natural Resources and Mainstay Large Cap, you can compare the effects of market volatilities on Jennison Natural and Mainstay Large 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 Jennison Natural with a short position of Mainstay Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jennison Natural and Mainstay Large.
Diversification Opportunities for Jennison Natural and Mainstay Large
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jennison and Mainstay is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Jennison Natural Resources and Mainstay Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Large Cap and Jennison Natural 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 Jennison Natural Resources are associated (or correlated) with Mainstay Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Large Cap has no effect on the direction of Jennison Natural i.e., Jennison Natural and Mainstay Large go up and down completely randomly.
Pair Corralation between Jennison Natural and Mainstay Large
Assuming the 90 days horizon Jennison Natural is expected to generate 8.76 times less return on investment than Mainstay Large. But when comparing it to its historical volatility, Jennison Natural Resources is 1.05 times less risky than Mainstay Large. It trades about 0.01 of its potential returns per unit of risk. Mainstay Large Cap is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 867.00 in Mainstay Large Cap on October 20, 2024 and sell it today you would earn a total of 343.00 from holding Mainstay Large Cap or generate 39.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jennison Natural Resources vs. Mainstay Large Cap
Performance |
| Timeline |
| Jennison Natural Res |
| Mainstay Large Cap |
Jennison Natural and Mainstay Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jennison Natural and Mainstay Large
The main advantage of trading using opposite Jennison Natural and Mainstay Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jennison Natural position performs unexpectedly, Mainstay Large 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 Large will offset losses from the drop in Mainstay Large's long position.| Jennison Natural vs. Voya High Yield | Jennison Natural vs. Voya High Yield | Jennison Natural vs. Lord Abbett Short | Jennison Natural vs. Buffalo High Yield |
| Mainstay Large vs. Transamerica Mlp Energy | Mainstay Large vs. Jennison Natural Resources | Mainstay Large vs. Ivy Natural Resources | Mainstay Large vs. Tortoise Energy Independence |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories |