Correlation Between MFS High and Credit Suisse
Can any of the company-specific risk be diversified away by investing in both MFS High and Credit Suisse 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 MFS High and Credit Suisse into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MFS High Yield and Credit Suisse Asset, you can compare the effects of market volatilities on MFS High and Credit Suisse 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 MFS High with a short position of Credit Suisse. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFS High and Credit Suisse.
Diversification Opportunities for MFS High and Credit Suisse
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between MFS and Credit is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding MFS High Yield and Credit Suisse Asset in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Credit Suisse Asset and MFS High 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 MFS High Yield are associated (or correlated) with Credit Suisse. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Credit Suisse Asset has no effect on the direction of MFS High i.e., MFS High and Credit Suisse go up and down completely randomly.
Pair Corralation between MFS High and Credit Suisse
Considering the 90-day investment horizon MFS High Yield is expected to generate 1.03 times more return on investment than Credit Suisse. However, MFS High is 1.03 times more volatile than Credit Suisse Asset. It trades about 0.22 of its potential returns per unit of risk. Credit Suisse Asset is currently generating about 0.1 per unit of risk. If you would invest 354.00 in MFS High Yield on September 2, 2024 and sell it today you would earn a total of 11.00 from holding MFS High Yield or generate 3.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MFS High Yield vs. Credit Suisse Asset
Performance |
| Timeline |
| MFS High Yield |
| Credit Suisse Asset |
MFS High and Credit Suisse Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MFS High and Credit Suisse
The main advantage of trading using opposite MFS High and Credit Suisse positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MFS High position performs unexpectedly, Credit Suisse 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 Credit Suisse will offset losses from the drop in Credit Suisse's long position.| MFS High vs. MFS Investment Grade | MFS High vs. MFS Municipal Income | MFS High vs. DTF Tax Free | MFS High vs. MFS Government Markets |
| Credit Suisse vs. BNY Mellon High | Credit Suisse vs. Mfs Intermediate High | Credit Suisse vs. Eaton Vance Risk | Credit Suisse vs. Nuveen Floating Rate |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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