Correlation Between MFS High and CBH
Can any of the company-specific risk be diversified away by investing in both MFS High and CBH 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 CBH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MFS High Income and CBH, you can compare the effects of market volatilities on MFS High and CBH 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 CBH. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFS High and CBH.
Diversification Opportunities for MFS High and CBH
Very good diversification
The 3 months correlation between MFS and CBH is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding MFS High Income and CBH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CBH 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 Income are associated (or correlated) with CBH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CBH has no effect on the direction of MFS High i.e., MFS High and CBH go up and down completely randomly.
Pair Corralation between MFS High and CBH
If you would invest 919.00 in CBH on August 28, 2024 and sell it today you would earn a total of 0.00 from holding CBH or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
MFS High Income vs. CBH
Performance |
| Timeline |
| MFS High Income |
| CBH |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
MFS High and CBH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MFS High and CBH
The main advantage of trading using opposite MFS High and CBH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MFS High position performs unexpectedly, CBH 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 CBH will offset losses from the drop in CBH's long position.| MFS High vs. MFS Investment Grade | MFS High vs. Eaton Vance National | MFS High vs. Invesco High Income | MFS High vs. Blackrock Muniholdings Ny |
| CBH vs. MFS Investment Grade | CBH vs. Invesco High Income | CBH vs. Eaton Vance National | CBH vs. Nuveen California Select |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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