Correlation Between Mainstay Cushing and Tax-managed

Can any of the company-specific risk be diversified away by investing in both Mainstay Cushing and Tax-managed 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 Cushing and Tax-managed into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Mainstay Cushing Mlp and Tax Managed Large Cap, you can compare the effects of market volatilities on Mainstay Cushing and Tax-managed 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 Cushing with a short position of Tax-managed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mainstay Cushing and Tax-managed.

Diversification Opportunities for Mainstay Cushing and Tax-managed

0.58

Correlation Coefficient

Mainstay Cushing  Tax-managed

Very weak diversification

The 3 months correlation between Mainstay and Tax-managed is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay Cushing Mlp and Tax Managed Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tax Managed Large and Mainstay Cushing 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 Cushing Mlp are associated (or correlated) with Tax-managed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tax Managed Large has no effect on the direction of Mainstay Cushing i.e., Mainstay Cushing and Tax-managed go up and down completely randomly.

Pair Corralation between Mainstay Cushing and Tax-managed

Assuming the 90 days horizon Mainstay Cushing Mlp is expected to generate 1.43 times more return on investment than Tax-managed. However, Mainstay Cushing is 1.43 times more volatile than Tax Managed Large Cap. It trades about 0.23 of its potential returns per unit of risk. Tax Managed Large Cap is currently generating about 0.05 per unit of risk. If you would invest  1,065  in Mainstay Cushing Mlp on October 23, 2024 and sell it today you would earn a total of  183.00  from holding Mainstay Cushing Mlp or generate 17.18% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	100.0%
Values	Daily Returns

Mainstay Cushing Mlp  vs.  Tax Managed Large Cap

Mainstay Cushing Mlp

Risk-Adjusted Performance

18 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Mainstay Cushing Mlp are ranked lower than 18 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Mainstay Cushing showed solid returns over the last few months and may actually be approaching a breakup point.

Tax Managed Large

Risk-Adjusted Performance

4 of 100

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Tax Managed Large Cap are ranked lower than 4 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Tax-managed is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Mainstay Cushing and Tax-managed

The main advantage of trading using opposite Mainstay Cushing and Tax-managed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mainstay Cushing position performs unexpectedly, Tax-managed 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 Tax-managed will offset losses from the drop in Tax-managed's long position.

The idea behind Mainstay Cushing Mlp and Tax Managed Large Cap pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..