Correlation Between Mainstay Defined and Omni Small
Can any of the company-specific risk be diversified away by investing in both Mainstay Defined and Omni Small 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 Mainstay Defined and Omni Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mainstay Defined Term and Omni Small Cap Value, you can compare the effects of market volatilities on Mainstay Defined and Omni Small 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 Mainstay Defined with a short position of Omni Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mainstay Defined and Omni Small.
Diversification Opportunities for Mainstay Defined and Omni Small
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Mainstay and Omni is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay Defined Term and Omni Small Cap Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Omni Small Cap and Mainstay Defined 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 Mainstay Defined Term are associated (or correlated) with Omni Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Omni Small Cap has no effect on the direction of Mainstay Defined i.e., Mainstay Defined and Omni Small go up and down completely randomly.
Pair Corralation between Mainstay Defined and Omni Small
Assuming the 90 days horizon Mainstay Defined Term is expected to generate 0.16 times more return on investment than Omni Small. However, Mainstay Defined Term is 6.18 times less risky than Omni Small. It trades about 0.04 of its potential returns per unit of risk. Omni Small Cap Value is currently generating about -0.03 per unit of risk. If you would invest 1,701 in Mainstay Defined Term on September 13, 2024 and sell it today you would earn a total of 8.00 from holding Mainstay Defined Term or generate 0.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mainstay Defined Term vs. Omni Small Cap Value
Performance |
| Timeline |
| Mainstay Defined Term |
| Omni Small Cap |
Mainstay Defined and Omni Small Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mainstay Defined and Omni Small
The main advantage of trading using opposite Mainstay Defined and Omni Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mainstay Defined position performs unexpectedly, Omni Small 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 Omni Small will offset losses from the drop in Omni Small's long position.| Mainstay Defined vs. World Energy Fund | Mainstay Defined vs. Alpsalerian Energy Infrastructure | Mainstay Defined vs. Oil Gas Ultrasector | Mainstay Defined vs. Fidelity Advisor Energy |
| Omni Small vs. Pace Smallmedium Value | Omni Small vs. Great West Loomis Sayles | Omni Small vs. Ab Discovery Value | Omni Small vs. Fidelity Small Cap |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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