Correlation Between Cadiz Depositary and Mfs Utilities

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Cadiz Depositary and Mfs Utilities 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 Cadiz Depositary and Mfs Utilities into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cadiz Depositary Shares and Mfs Utilities Fund, you can compare the effects of market volatilities on Cadiz Depositary and Mfs Utilities 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 Cadiz Depositary with a short position of Mfs Utilities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cadiz Depositary and Mfs Utilities.

Diversification Opportunities for Cadiz Depositary and Mfs Utilities

CadizMfsDiversified AwayCadizMfsDiversified Away100%
-0.6
  Correlation Coefficient

Excellent diversification

The 3 months correlation between Cadiz and Mfs is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Cadiz Depositary Shares and Mfs Utilities Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Utilities and Cadiz Depositary 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 Cadiz Depositary Shares are associated (or correlated) with Mfs Utilities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Utilities has no effect on the direction of Cadiz Depositary i.e., Cadiz Depositary and Mfs Utilities go up and down completely randomly.

Pair Corralation between Cadiz Depositary and Mfs Utilities

Assuming the 90 days horizon Cadiz Depositary is expected to generate 2.53 times less return on investment than Mfs Utilities. But when comparing it to its historical volatility, Cadiz Depositary Shares is 1.04 times less risky than Mfs Utilities. It trades about 0.06 of its potential returns per unit of risk. Mfs Utilities Fund is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest  2,232  in Mfs Utilities Fund on November 27, 2024 and sell it today you would earn a total of  42.00  from holding Mfs Utilities Fund or generate 1.88% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthWeak
Accuracy100.0%
ValuesDaily Returns

Cadiz Depositary Shares  vs.  Mfs Utilities Fund

 Performance 
JavaScript chart by amCharts 3.21.15Dec2025Feb -10-505101520
JavaScript chart by amCharts 3.21.15CDZIP MURRX
       Timeline  
Cadiz Depositary Shares 

Risk-Adjusted Performance

Solid

 
Weak
 
Strong
Compared to the overall equity markets, risk-adjusted returns on investments in Cadiz Depositary Shares are ranked lower than 16 (%) of all global equities and portfolios over the last 90 days. Even with relatively weak forward indicators, Cadiz Depositary reported solid returns over the last few months and may actually be approaching a breakup point.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb1616.51717.51818.519
Mfs Utilities 

Risk-Adjusted Performance

Very Weak

 
Weak
 
Strong
Over the last 90 days Mfs Utilities Fund has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.
JavaScript chart by amCharts 3.21.15DecJanFebJanFeb2222.52323.52424.5

Cadiz Depositary and Mfs Utilities Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-3.09-2.32-1.54-0.76-0.01290.861.742.613.49 0.10.20.30.4
JavaScript chart by amCharts 3.21.15CDZIP MURRX
       Returns  

Pair Trading with Cadiz Depositary and Mfs Utilities

The main advantage of trading using opposite Cadiz Depositary and Mfs Utilities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cadiz Depositary position performs unexpectedly, Mfs Utilities 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 Utilities will offset losses from the drop in Mfs Utilities' long position.
The idea behind Cadiz Depositary Shares and Mfs Utilities Fund 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.

Other Complementary Tools

Competition Analyzer
Analyze and compare many basic indicators for a group of related or unrelated entities
Portfolio Rebalancing
Analyze risk-adjusted returns against different time horizons to find asset-allocation targets
Top Crypto Exchanges
Search and analyze digital assets across top global cryptocurrency exchanges
Portfolio Analyzer
Portfolio analysis module that provides access to portfolio diagnostics and optimization engine
Funds Screener
Find actively-traded funds from around the world traded on over 30 global exchanges