Correlation Between Upright Assets and Mainstay Map

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

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

Diversification Opportunities for Upright Assets and Mainstay Map

0.18

Correlation Coefficient

Upright Assets  Mainstay Map

Average diversification

The 3 months correlation between Upright and Mainstay is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Upright Assets Allocation and Mainstay Map Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Map Equity and Upright Assets 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 Upright Assets Allocation are associated (or correlated) with Mainstay Map. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Map Equity has no effect on the direction of Upright Assets i.e., Upright Assets and Mainstay Map go up and down completely randomly.

Pair Corralation between Upright Assets and Mainstay Map

Assuming the 90 days horizon Upright Assets Allocation is expected to under-perform the Mainstay Map. In addition to that, Upright Assets is 3.66 times more volatile than Mainstay Map Equity. It trades about -0.02 of its total potential returns per unit of risk. Mainstay Map Equity is currently generating about -0.03 per unit of volatility. If you would invest  2,070  in Mainstay Map Equity on December 8, 2024 and sell it today you would lose (30.00) from holding Mainstay Map Equity or give up 1.45% of portfolio value over 90 days.

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

Upright Assets Allocation  vs.  Mainstay Map Equity

Upright Assets Allocation

Risk-Adjusted Performance

Very Weak

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

Mainstay Map Equity

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Upright Assets and Mainstay Map

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

The idea behind Upright Assets Allocation and Mainstay Map Equity 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.