Correlation Between Mainstay Cushing and Oppenheimer Steelpath

Can any of the company-specific risk be diversified away by investing in both Mainstay Cushing and Oppenheimer Steelpath 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 Oppenheimer Steelpath 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 Oppenheimer Steelpath Mlp, you can compare the effects of market volatilities on Mainstay Cushing and Oppenheimer Steelpath 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 Oppenheimer Steelpath. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mainstay Cushing and Oppenheimer Steelpath.

Diversification Opportunities for Mainstay Cushing and Oppenheimer Steelpath

0.98

Correlation Coefficient

Mainstay Cushing  Oppenheimer Steelpath

Almost no diversification

The 3 months correlation between Mainstay and Oppenheimer is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay Cushing Mlp and Oppenheimer Steelpath Mlp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oppenheimer Steelpath Mlp 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 Oppenheimer Steelpath. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oppenheimer Steelpath Mlp has no effect on the direction of Mainstay Cushing i.e., Mainstay Cushing and Oppenheimer Steelpath go up and down completely randomly.

Pair Corralation between Mainstay Cushing and Oppenheimer Steelpath

Assuming the 90 days horizon Mainstay Cushing Mlp is expected to generate 1.11 times more return on investment than Oppenheimer Steelpath. However, Mainstay Cushing is 1.11 times more volatile than Oppenheimer Steelpath Mlp. It trades about 0.67 of its potential returns per unit of risk. Oppenheimer Steelpath Mlp is currently generating about 0.57 per unit of risk. If you would invest  1,218  in Mainstay Cushing Mlp on October 23, 2024 and sell it today you would earn a total of  144.00  from holding Mainstay Cushing Mlp or generate 11.82% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Strong
Accuracy	94.74%
Values	Daily Returns

Mainstay Cushing Mlp  vs.  Oppenheimer Steelpath Mlp

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.

Oppenheimer Steelpath Mlp

Risk-Adjusted Performance

19 of 100

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Oppenheimer Steelpath Mlp are ranked lower than 19 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Oppenheimer Steelpath showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Mainstay Cushing and Oppenheimer Steelpath

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

The idea behind Mainstay Cushing Mlp and Oppenheimer Steelpath Mlp 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.