Correlation Between Mainstay Convertible and Hartford International

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

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

Diversification Opportunities for Mainstay Convertible and Hartford International

0.57

Correlation Coefficient

Mainstay Convertible  Hartford International

Very weak diversification

The 3 months correlation between Mainstay and Hartford is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay Vertible Fund and Hartford International Opportu in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford International and Mainstay Convertible 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 Vertible Fund are associated (or correlated) with Hartford International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartford International has no effect on the direction of Mainstay Convertible i.e., Mainstay Convertible and Hartford International go up and down completely randomly.

Pair Corralation between Mainstay Convertible and Hartford International

Assuming the 90 days horizon Mainstay Vertible Fund is expected to under-perform the Hartford International. In addition to that, Mainstay Convertible is 1.43 times more volatile than Hartford International Opportunities. It trades about -0.3 of its total potential returns per unit of risk. Hartford International Opportunities is currently generating about -0.28 per unit of volatility. If you would invest  1,693  in Hartford International Opportunities on October 10, 2024 and sell it today you would lose (67.00) from holding Hartford International Opportunities or give up 3.96% of portfolio value over 90 days.

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

Mainstay Vertible Fund  vs.  Hartford International Opportu

Mainstay Convertible

Risk-Adjusted Performance

0 of 100

Very Weak

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

Hartford International

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Hartford International Opportunities has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Hartford International 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 Convertible and Hartford International

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

The idea behind Mainstay Vertible Fund and Hartford International Opportunities 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..