Correlation Between Mainstay Cornerstone and Jp Morgan

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

By analyzing existing cross correlation between Mainstay Nerstone Growth and Jp Morgan Smartretirement, you can compare the effects of market volatilities on Mainstay Cornerstone and Jp Morgan 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 Cornerstone with a short position of Jp Morgan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mainstay Cornerstone and Jp Morgan.

Diversification Opportunities for Mainstay Cornerstone and Jp Morgan

0.88

Correlation Coefficient

Mainstay Cornerstone  Jp Morgan

Very poor diversification

The 3 months correlation between Mainstay and JTSQX is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay Nerstone Growth and Jp Morgan Smartretirement in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jp Morgan Smartretirement and Mainstay Cornerstone 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 Nerstone Growth are associated (or correlated) with Jp Morgan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jp Morgan Smartretirement has no effect on the direction of Mainstay Cornerstone i.e., Mainstay Cornerstone and Jp Morgan go up and down completely randomly.

Pair Corralation between Mainstay Cornerstone and Jp Morgan

Assuming the 90 days horizon Mainstay Nerstone Growth is expected to generate 1.6 times more return on investment than Jp Morgan. However, Mainstay Cornerstone is 1.6 times more volatile than Jp Morgan Smartretirement. It trades about 0.17 of its potential returns per unit of risk. Jp Morgan Smartretirement is currently generating about 0.14 per unit of risk. If you would invest  4,601  in Mainstay Nerstone Growth on September 4, 2024 and sell it today you would earn a total of  494.00  from holding Mainstay Nerstone Growth or generate 10.74% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	98.44%
Values	Daily Returns

Mainstay Nerstone Growth  vs.  Jp Morgan Smartretirement

Mainstay Nerstone Growth

Risk-Adjusted Performance

13 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Mainstay Nerstone Growth are ranked lower than 13 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Mainstay Cornerstone may actually be approaching a critical reversion point that can send shares even higher in January 2025.

Jp Morgan Smartretirement

Risk-Adjusted Performance

10 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Jp Morgan Smartretirement are ranked lower than 10 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Jp Morgan 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 Cornerstone and Jp Morgan

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

The idea behind Mainstay Nerstone Growth and Jp Morgan Smartretirement 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.

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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.