Correlation Between Aqr Large and Mainstay
Can any of the company-specific risk be diversified away by investing in both Aqr Large 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 Aqr Large and Mainstay into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aqr Large Cap and Mainstay Sp 500, you can compare the effects of market volatilities on Aqr Large 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 Aqr Large with a short position of Mainstay. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aqr Large and Mainstay.
Diversification Opportunities for Aqr Large and Mainstay
Almost no diversification
The 3 months correlation between Aqr and Mainstay is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Aqr Large Cap 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 Aqr Large 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 Aqr Large Cap 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 Aqr Large i.e., Aqr Large and Mainstay go up and down completely randomly.
Pair Corralation between Aqr Large and Mainstay
Assuming the 90 days horizon Aqr Large Cap is expected to generate 1.12 times more return on investment than Mainstay. However, Aqr Large is 1.12 times more volatile than Mainstay Sp 500. It trades about 0.12 of its potential returns per unit of risk. Mainstay Sp 500 is currently generating about 0.13 per unit of risk. If you would invest 1,757 in Aqr Large Cap on August 29, 2024 and sell it today you would earn a total of 414.00 from holding Aqr Large Cap or generate 23.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.52% |
| Values | Daily Returns |
Aqr Large Cap vs. Mainstay Sp 500
Performance |
| Timeline |
| Aqr Large Cap |
| Mainstay Sp 500 |
Aqr Large and Mainstay Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aqr Large and Mainstay
The main advantage of trading using opposite Aqr Large and Mainstay positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aqr Large 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.| Aqr Large vs. Aqr Large Cap | Aqr Large vs. Aqr Large Cap | Aqr Large vs. Aqr Small Cap | Aqr Large vs. Aqr Small Cap |
| 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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