Correlation Between MFS High and Blackrock Munivest
Can any of the company-specific risk be diversified away by investing in both MFS High and Blackrock Munivest 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 Blackrock Munivest 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 Blackrock Munivest, you can compare the effects of market volatilities on MFS High and Blackrock Munivest 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 Blackrock Munivest. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFS High and Blackrock Munivest.
Diversification Opportunities for MFS High and Blackrock Munivest
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between MFS and Blackrock is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding MFS High Yield and Blackrock Munivest in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Munivest 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 Blackrock Munivest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock Munivest has no effect on the direction of MFS High i.e., MFS High and Blackrock Munivest go up and down completely randomly.
Pair Corralation between MFS High and Blackrock Munivest
Considering the 90-day investment horizon MFS High is expected to generate 1.07 times less return on investment than Blackrock Munivest. In addition to that, MFS High is 1.01 times more volatile than Blackrock Munivest. It trades about 0.17 of its total potential returns per unit of risk. Blackrock Munivest is currently generating about 0.19 per unit of volatility. If you would invest 1,081 in Blackrock Munivest on August 30, 2024 and sell it today you would earn a total of 33.00 from holding Blackrock Munivest or generate 3.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MFS High Yield vs. Blackrock Munivest
Performance |
| Timeline |
| MFS High Yield |
| Blackrock Munivest |
MFS High and Blackrock Munivest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MFS High and Blackrock Munivest
The main advantage of trading using opposite MFS High and Blackrock Munivest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MFS High position performs unexpectedly, Blackrock Munivest 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 Blackrock Munivest will offset losses from the drop in Blackrock Munivest'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 |
| Blackrock Munivest vs. MFS Investment Grade | Blackrock Munivest vs. Eaton Vance National | Blackrock Munivest vs. Blackrock Muniholdings Closed | Blackrock Munivest vs. Blackrock Muniyield Quality |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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