Correlation Between Red Oak and Mainstay Epoch
Can any of the company-specific risk be diversified away by investing in both Red Oak and Mainstay Epoch 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 Red Oak and Mainstay Epoch into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Red Oak Technology and Mainstay Epoch Equity, you can compare the effects of market volatilities on Red Oak and Mainstay Epoch 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 Red Oak with a short position of Mainstay Epoch. Check out your portfolio center. Please also check ongoing floating volatility patterns of Red Oak and Mainstay Epoch.
Diversification Opportunities for Red Oak and Mainstay Epoch
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Red and Mainstay is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Red Oak Technology and Mainstay Epoch Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Epoch Equity and Red Oak 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 Red Oak Technology are associated (or correlated) with Mainstay Epoch. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Epoch Equity has no effect on the direction of Red Oak i.e., Red Oak and Mainstay Epoch go up and down completely randomly.
Pair Corralation between Red Oak and Mainstay Epoch
Assuming the 90 days horizon Red Oak Technology is expected to under-perform the Mainstay Epoch. In addition to that, Red Oak is 2.48 times more volatile than Mainstay Epoch Equity. It trades about -0.11 of its total potential returns per unit of risk. Mainstay Epoch Equity is currently generating about 0.19 per unit of volatility. If you would invest 2,102 in Mainstay Epoch Equity on October 23, 2024 and sell it today you would earn a total of 48.00 from holding Mainstay Epoch Equity or generate 2.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Red Oak Technology vs. Mainstay Epoch Equity
Performance |
| Timeline |
| Red Oak Technology |
| Mainstay Epoch Equity |
Red Oak and Mainstay Epoch Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Red Oak and Mainstay Epoch
The main advantage of trading using opposite Red Oak and Mainstay Epoch positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Red Oak position performs unexpectedly, Mainstay Epoch 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 Epoch will offset losses from the drop in Mainstay Epoch's long position.| Red Oak vs. Pin Oak Equity | Red Oak vs. White Oak Select | Red Oak vs. Black Oak Emerging | Red Oak vs. Berkshire Focus |
| Mainstay Epoch vs. Science Technology Fund | Mainstay Epoch vs. Red Oak Technology | Mainstay Epoch vs. Vanguard Information Technology | Mainstay Epoch vs. Allianzgi Technology Fund |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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