Correlation Between Mainstay Floating and Goehring Rozencwajg

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

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

Diversification Opportunities for Mainstay Floating and Goehring Rozencwajg

-0.46

Correlation Coefficient

Mainstay Floating  Goehring Rozencwajg

Very good diversification

The 3 months correlation between Mainstay and Goehring is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Mainstay Floating Rate and Goehring Rozencwajg Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goehring Rozencwajg and Mainstay Floating 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 Floating Rate are associated (or correlated) with Goehring Rozencwajg. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goehring Rozencwajg has no effect on the direction of Mainstay Floating i.e., Mainstay Floating and Goehring Rozencwajg go up and down completely randomly.

Pair Corralation between Mainstay Floating and Goehring Rozencwajg

Assuming the 90 days horizon Mainstay Floating Rate is expected to generate 0.08 times more return on investment than Goehring Rozencwajg. However, Mainstay Floating Rate is 13.04 times less risky than Goehring Rozencwajg. It trades about 0.19 of its potential returns per unit of risk. Goehring Rozencwajg Resources is currently generating about -0.05 per unit of risk. If you would invest  878.00  in Mainstay Floating Rate on October 11, 2024 and sell it today you would earn a total of  12.00  from holding Mainstay Floating Rate or generate 1.37% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	98.39%
Values	Daily Returns

Mainstay Floating Rate  vs.  Goehring Rozencwajg Resources

Mainstay Floating Rate

Risk-Adjusted Performance

15 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Mainstay Floating Rate are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong primary indicators, Mainstay Floating is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Goehring Rozencwajg

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Goehring Rozencwajg Resources has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Goehring Rozencwajg 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 Floating and Goehring Rozencwajg

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

The idea behind Mainstay Floating Rate and Goehring Rozencwajg Resources 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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.