Correlation Between Western Asset and Mainstay Epoch
Can any of the company-specific risk be diversified away by investing in both Western Asset 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 Western Asset and Mainstay Epoch into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Western Asset Inflation and Mainstay Epoch Equity, you can compare the effects of market volatilities on Western Asset 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 Western Asset with a short position of Mainstay Epoch. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Asset and Mainstay Epoch.
Diversification Opportunities for Western Asset and Mainstay Epoch
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Western and Mainstay is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Western Asset Inflation 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 Western Asset 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 Western Asset Inflation 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 Western Asset i.e., Western Asset and Mainstay Epoch go up and down completely randomly.
Pair Corralation between Western Asset and Mainstay Epoch
Assuming the 90 days horizon Western Asset is expected to generate 4.94 times less return on investment than Mainstay Epoch. But when comparing it to its historical volatility, Western Asset Inflation is 2.18 times less risky than Mainstay Epoch. It trades about 0.15 of its potential returns per unit of risk. Mainstay Epoch Equity is currently generating about 0.34 of returns per unit of risk over similar time horizon. If you would invest 2,223 in Mainstay Epoch Equity on September 2, 2024 and sell it today you would earn a total of 108.00 from holding Mainstay Epoch Equity or generate 4.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Asset Inflation vs. Mainstay Epoch Equity
Performance |
| Timeline |
| Western Asset Inflation |
| Mainstay Epoch Equity |
Western Asset and Mainstay Epoch Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Asset and Mainstay Epoch
The main advantage of trading using opposite Western Asset and Mainstay Epoch positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Asset 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.| Western Asset vs. Rbc Global Opportunities | Western Asset vs. T Rowe Price | Western Asset vs. Barings Global Floating | Western Asset vs. Wisdomtree Siegel Global |
| Mainstay Epoch vs. Victory Strategic Allocation | Mainstay Epoch vs. Aqr Large Cap | Mainstay Epoch vs. Touchstone Large Cap | Mainstay Epoch vs. T Rowe Price |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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