Correlation Between Sprott Gold and Mainstay Short
Can any of the company-specific risk be diversified away by investing in both Sprott Gold and Mainstay Short 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 Sprott Gold and Mainstay Short into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sprott Gold Equity and Mainstay Short Duration, you can compare the effects of market volatilities on Sprott Gold and Mainstay Short 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 Sprott Gold with a short position of Mainstay Short. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sprott Gold and Mainstay Short.
Diversification Opportunities for Sprott Gold and Mainstay Short
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Sprott and Mainstay is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Sprott Gold Equity and Mainstay Short Duration in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Short Duration and Sprott Gold 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 Sprott Gold Equity are associated (or correlated) with Mainstay Short. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Short Duration has no effect on the direction of Sprott Gold i.e., Sprott Gold and Mainstay Short go up and down completely randomly.
Pair Corralation between Sprott Gold and Mainstay Short
Assuming the 90 days horizon Sprott Gold Equity is expected to generate 15.4 times more return on investment than Mainstay Short. However, Sprott Gold is 15.4 times more volatile than Mainstay Short Duration. It trades about 0.08 of its potential returns per unit of risk. Mainstay Short Duration is currently generating about 0.22 per unit of risk. If you would invest 4,271 in Sprott Gold Equity on August 25, 2024 and sell it today you would earn a total of 1,348 from holding Sprott Gold Equity or generate 31.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sprott Gold Equity vs. Mainstay Short Duration
Performance |
| Timeline |
| Sprott Gold Equity |
| Mainstay Short Duration |
Sprott Gold and Mainstay Short Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sprott Gold and Mainstay Short
The main advantage of trading using opposite Sprott Gold and Mainstay Short positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sprott Gold position performs unexpectedly, Mainstay Short 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 Short will offset losses from the drop in Mainstay Short's long position.| Sprott Gold vs. Sprott Junior Gold | Sprott Gold vs. Sprott Gold Miners | Sprott Gold vs. Europac Gold Fund | Sprott Gold vs. US Global GO |
| Mainstay Short vs. International Investors Gold | Mainstay Short vs. Sprott Gold Equity | Mainstay Short vs. Wells Fargo Advantage | Mainstay Short vs. Wells Fargo Advantage |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Top Crypto Exchanges Search and analyze digital assets across top global cryptocurrency exchanges | |
| Global Correlations Find global opportunities by holding instruments from different markets |