Correlation Between CBH and MFS Charter
Can any of the company-specific risk be diversified away by investing in both CBH and MFS Charter 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 CBH and MFS Charter into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CBH and MFS Charter Income, you can compare the effects of market volatilities on CBH and MFS Charter 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 CBH with a short position of MFS Charter. Check out your portfolio center. Please also check ongoing floating volatility patterns of CBH and MFS Charter.
Diversification Opportunities for CBH and MFS Charter
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CBH and MFS is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding CBH and MFS Charter Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MFS Charter Income and CBH 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 CBH are associated (or correlated) with MFS Charter. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MFS Charter Income has no effect on the direction of CBH i.e., CBH and MFS Charter go up and down completely randomly.
Pair Corralation between CBH and MFS Charter
Considering the 90-day investment horizon CBH is expected to generate 1.18 times less return on investment than MFS Charter. But when comparing it to its historical volatility, CBH is 1.79 times less risky than MFS Charter. It trades about 0.05 of its potential returns per unit of risk. MFS Charter Income is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 545.00 in MFS Charter Income on August 31, 2024 and sell it today you would earn a total of 86.50 from holding MFS Charter Income or generate 15.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 86.82% |
| Values | Daily Returns |
CBH vs. MFS Charter Income
Performance |
| Timeline |
| CBH |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| MFS Charter Income |
CBH and MFS Charter Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CBH and MFS Charter
The main advantage of trading using opposite CBH and MFS Charter positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CBH position performs unexpectedly, MFS Charter 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 Charter will offset losses from the drop in MFS Charter's long position.| CBH vs. Eaton Vance National | CBH vs. Invesco High Income | CBH vs. Blackrock Muniholdings Ny | CBH vs. Nuveen California Select |
| MFS Charter vs. MFS High Income | MFS Charter vs. MFS Investment Grade | MFS Charter vs. Eaton Vance National | MFS Charter vs. Invesco High Income |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
Other Complementary Tools
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Fundamental Analysis View fundamental data based on most recent published financial statements |