Correlation Between Ab Select and Mfs Prudent
Can any of the company-specific risk be diversified away by investing in both Ab Select and Mfs Prudent 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 Ab Select and Mfs Prudent into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Select Longshort and Mfs Prudent Investor, you can compare the effects of market volatilities on Ab Select and Mfs Prudent 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 Ab Select with a short position of Mfs Prudent. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Select and Mfs Prudent.
Diversification Opportunities for Ab Select and Mfs Prudent
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between ASCLX and Mfs is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Ab Select Longshort and Mfs Prudent Investor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Prudent Investor and Ab Select 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 Ab Select Longshort are associated (or correlated) with Mfs Prudent. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Prudent Investor has no effect on the direction of Ab Select i.e., Ab Select and Mfs Prudent go up and down completely randomly.
Pair Corralation between Ab Select and Mfs Prudent
Assuming the 90 days horizon Ab Select Longshort is expected to under-perform the Mfs Prudent. In addition to that, Ab Select is 4.56 times more volatile than Mfs Prudent Investor. It trades about -0.2 of its total potential returns per unit of risk. Mfs Prudent Investor is currently generating about 0.16 per unit of volatility. If you would invest 1,198 in Mfs Prudent Investor on September 12, 2024 and sell it today you would earn a total of 14.00 from holding Mfs Prudent Investor or generate 1.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Select Longshort vs. Mfs Prudent Investor
Performance |
| Timeline |
| Ab Select Longshort |
| Mfs Prudent Investor |
Ab Select and Mfs Prudent Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Select and Mfs Prudent
The main advantage of trading using opposite Ab Select and Mfs Prudent positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Select position performs unexpectedly, Mfs Prudent 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 Mfs Prudent will offset losses from the drop in Mfs Prudent's long position.| Ab Select vs. Diamond Hill Long Short | Ab Select vs. Pimco Rae Worldwide | Ab Select vs. SCOR PK | Ab Select vs. Morningstar Unconstrained Allocation |
| Mfs Prudent vs. Firsthand Alternative Energy | Mfs Prudent vs. Fidelity Advisor Energy | Mfs Prudent vs. Dreyfus Natural Resources | Mfs Prudent vs. Gamco Natural Resources |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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