Correlation Between Value Fund and Mainstay Balanced
Can any of the company-specific risk be diversified away by investing in both Value Fund and Mainstay Balanced 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 Value Fund and Mainstay Balanced into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Value Fund Investor and Mainstay Balanced Fund, you can compare the effects of market volatilities on Value Fund and Mainstay Balanced 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 Value Fund with a short position of Mainstay Balanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Value Fund and Mainstay Balanced.
Diversification Opportunities for Value Fund and Mainstay Balanced
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Value and Mainstay is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Value Fund Investor and Mainstay Balanced Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Balanced and Value Fund 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 Value Fund Investor are associated (or correlated) with Mainstay Balanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Balanced has no effect on the direction of Value Fund i.e., Value Fund and Mainstay Balanced go up and down completely randomly.
Pair Corralation between Value Fund and Mainstay Balanced
Assuming the 90 days horizon Value Fund Investor is expected to generate 0.78 times more return on investment than Mainstay Balanced. However, Value Fund Investor is 1.29 times less risky than Mainstay Balanced. It trades about 0.03 of its potential returns per unit of risk. Mainstay Balanced Fund is currently generating about -0.11 per unit of risk. If you would invest 864.00 in Value Fund Investor on September 13, 2024 and sell it today you would earn a total of 5.00 from holding Value Fund Investor or generate 0.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Value Fund Investor vs. Mainstay Balanced Fund
Performance |
| Timeline |
| Value Fund Investor |
| Mainstay Balanced |
Value Fund and Mainstay Balanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Value Fund and Mainstay Balanced
The main advantage of trading using opposite Value Fund and Mainstay Balanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Value Fund position performs unexpectedly, Mainstay Balanced 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 Balanced will offset losses from the drop in Mainstay Balanced's long position.| Value Fund vs. International Growth Fund | Value Fund vs. Growth Fund Investor | Value Fund vs. Equity Income Fund | Value Fund vs. Ultra Fund Investor |
| Mainstay Balanced vs. California High Yield Municipal | Mainstay Balanced vs. Needham Aggressive Growth | Mainstay Balanced vs. T Rowe Price | Mainstay Balanced vs. Us High Relative |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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