Correlation Between Mainstay Balanced and Volumetric Fund

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

By analyzing existing cross correlation between Mainstay Balanced Fund and Volumetric Fund Volumetric, you can compare the effects of market volatilities on Mainstay Balanced and Volumetric Fund 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 Balanced with a short position of Volumetric Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mainstay Balanced and Volumetric Fund.

Diversification Opportunities for Mainstay Balanced and Volumetric Fund

0.49

Correlation Coefficient

Mainstay Balanced  Volumetric Fund

Very weak diversification

The 3 months correlation between Mainstay and Volumetric is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay Balanced Fund and Volumetric Fund Volumetric in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Volumetric Fund Volu and Mainstay Balanced 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 Balanced Fund are associated (or correlated) with Volumetric Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Volumetric Fund Volu has no effect on the direction of Mainstay Balanced i.e., Mainstay Balanced and Volumetric Fund go up and down completely randomly.

Pair Corralation between Mainstay Balanced and Volumetric Fund

Assuming the 90 days horizon Mainstay Balanced Fund is expected to under-perform the Volumetric Fund. But the mutual fund apears to be less risky and, when comparing its historical volatility, Mainstay Balanced Fund is 1.13 times less risky than Volumetric Fund. The mutual fund trades about -0.07 of its potential returns per unit of risk. The Volumetric Fund Volumetric is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest  2,483  in Volumetric Fund Volumetric on September 15, 2024 and sell it today you would earn a total of  159.00  from holding Volumetric Fund Volumetric or generate 6.4% return on investment over 90 days.

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

Mainstay Balanced Fund  vs.  Volumetric Fund Volumetric

Mainstay Balanced

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mainstay Balanced Fund has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong forward indicators, Mainstay Balanced is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Volumetric Fund Volu

Risk-Adjusted Performance

10 of 100

OK

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

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

The idea behind Mainstay Balanced Fund and Volumetric Fund Volumetric 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.