Correlation Between Barings Emerging and Mfs Emerging
Can any of the company-specific risk be diversified away by investing in both Barings Emerging and Mfs Emerging 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 Emerging and Mfs Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barings Emerging Markets and Mfs Emerging Markets, you can compare the effects of market volatilities on Barings Emerging and Mfs Emerging 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 Emerging with a short position of Mfs Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Emerging and Mfs Emerging.
Diversification Opportunities for Barings Emerging and Mfs Emerging
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Barings and Mfs is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Barings Emerging Markets and Mfs Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Emerging Markets and Barings Emerging 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 Emerging Markets are associated (or correlated) with Mfs Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Emerging Markets has no effect on the direction of Barings Emerging i.e., Barings Emerging and Mfs Emerging go up and down completely randomly.
Pair Corralation between Barings Emerging and Mfs Emerging
Assuming the 90 days horizon Barings Emerging is expected to generate 5.26 times less return on investment than Mfs Emerging. In addition to that, Barings Emerging is 1.13 times more volatile than Mfs Emerging Markets. It trades about 0.02 of its total potential returns per unit of risk. Mfs Emerging Markets is currently generating about 0.13 per unit of volatility. If you would invest 1,207 in Mfs Emerging Markets on September 4, 2024 and sell it today you would earn a total of 9.00 from holding Mfs Emerging Markets or generate 0.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Barings Emerging Markets vs. Mfs Emerging Markets
Performance |
| Timeline |
| Barings Emerging Markets |
| Mfs Emerging Markets |
Barings Emerging and Mfs Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Emerging and Mfs Emerging
The main advantage of trading using opposite Barings Emerging and Mfs Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Emerging position performs unexpectedly, Mfs Emerging 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 Emerging will offset losses from the drop in Mfs Emerging's long position.| Barings Emerging vs. T Rowe Price | Barings Emerging vs. Volumetric Fund Volumetric | Barings Emerging vs. Rbb Fund | Barings Emerging vs. T Rowe Price |
| Mfs Emerging vs. Baron Health Care | Mfs Emerging vs. Health Biotchnology Portfolio | Mfs Emerging vs. Highland Longshort Healthcare | Mfs Emerging vs. Invesco Global Health |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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