Correlation Between Barings Active and Mfs Georgia
Can any of the company-specific risk be diversified away by investing in both Barings Active and Mfs Georgia 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 Barings Active and Mfs Georgia into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barings Active Short and Mfs Georgia Municipal, you can compare the effects of market volatilities on Barings Active and Mfs Georgia 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 Barings Active with a short position of Mfs Georgia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Active and Mfs Georgia.
Diversification Opportunities for Barings Active and Mfs Georgia
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Barings and Mfs is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Barings Active Short and Mfs Georgia Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Georgia Municipal and Barings Active 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 Barings Active Short are associated (or correlated) with Mfs Georgia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Georgia Municipal has no effect on the direction of Barings Active i.e., Barings Active and Mfs Georgia go up and down completely randomly.
Pair Corralation between Barings Active and Mfs Georgia
Assuming the 90 days horizon Barings Active is expected to generate 1.24 times less return on investment than Mfs Georgia. But when comparing it to its historical volatility, Barings Active Short is 3.28 times less risky than Mfs Georgia. It trades about 0.35 of its potential returns per unit of risk. Mfs Georgia Municipal is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 1,005 in Mfs Georgia Municipal on December 4, 2024 and sell it today you would earn a total of 7.00 from holding Mfs Georgia Municipal or generate 0.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Barings Active Short vs. Mfs Georgia Municipal
Performance |
| Timeline |
| Barings Active Short |
| Mfs Georgia Municipal |
Barings Active and Mfs Georgia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Active and Mfs Georgia
The main advantage of trading using opposite Barings Active and Mfs Georgia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Active position performs unexpectedly, Mfs Georgia 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 Georgia will offset losses from the drop in Mfs Georgia's long position.| Barings Active vs. Intal High Relative | Barings Active vs. Msift High Yield | Barings Active vs. Goldman Sachs High | Barings Active vs. Siit High Yield |
| Mfs Georgia vs. Avantis Large Cap | Mfs Georgia vs. American Mutual Fund | Mfs Georgia vs. Jpmorgan Large Cap | Mfs Georgia vs. Transamerica Large Cap |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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