Correlation Between Mainstay New and Ultramid-cap Profund

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

By analyzing existing cross correlation between Mainstay New York and Ultramid Cap Profund Ultramid Cap, you can compare the effects of market volatilities on Mainstay New and Ultramid-cap Profund 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 New with a short position of Ultramid-cap Profund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mainstay New and Ultramid-cap Profund.

Diversification Opportunities for Mainstay New and Ultramid-cap Profund

-0.11

Correlation Coefficient

Mainstay New  Ultramid-cap Profund

Good diversification

The 3 months correlation between Mainstay and Ultramid-cap is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay New York and Ultramid Cap Profund Ultramid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ultramid Cap Profund and Mainstay New 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 New York are associated (or correlated) with Ultramid-cap Profund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ultramid Cap Profund has no effect on the direction of Mainstay New i.e., Mainstay New and Ultramid-cap Profund go up and down completely randomly.

Pair Corralation between Mainstay New and Ultramid-cap Profund

Assuming the 90 days horizon Mainstay New York is expected to generate 0.12 times more return on investment than Ultramid-cap Profund. However, Mainstay New York is 8.04 times less risky than Ultramid-cap Profund. It trades about 0.03 of its potential returns per unit of risk. Ultramid Cap Profund Ultramid Cap is currently generating about -0.11 per unit of risk. If you would invest  948.00  in Mainstay New York on December 24, 2024 and sell it today you would earn a total of  4.00  from holding Mainstay New York or generate 0.42% return on investment over 90 days.

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

Mainstay New York  vs.  Ultramid Cap Profund Ultramid

Mainstay New York

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Mainstay New York are ranked lower than 2 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Mainstay New is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Ultramid Cap Profund

Risk-Adjusted Performance

Very Weak

Over the last 90 days Ultramid Cap Profund Ultramid Cap has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's forward indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Pair Trading with Mainstay New and Ultramid-cap Profund

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

The idea behind Mainstay New York and Ultramid Cap Profund Ultramid 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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..