Correlation Between MFS High and Cion Investment
Can any of the company-specific risk be diversified away by investing in both MFS High and Cion Investment 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 Cion Investment 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 Cion Investment Corp, you can compare the effects of market volatilities on MFS High and Cion Investment 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 Cion Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFS High and Cion Investment.
Diversification Opportunities for MFS High and Cion Investment
0.03 | Correlation Coefficient |
Significant diversification
The 3 months correlation between MFS and Cion is 0.03. Overlapping area represents the amount of risk that can be diversified away by holding MFS High Income and Cion Investment Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cion Investment Corp 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 Cion Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cion Investment Corp has no effect on the direction of MFS High i.e., MFS High and Cion Investment go up and down completely randomly.
Pair Corralation between MFS High and Cion Investment
Considering the 90-day investment horizon MFS High is expected to generate 1.49 times less return on investment than Cion Investment. In addition to that, MFS High is 1.0 times more volatile than Cion Investment Corp. It trades about 0.14 of its total potential returns per unit of risk. Cion Investment Corp is currently generating about 0.2 per unit of volatility. If you would invest 1,130 in Cion Investment Corp on November 5, 2024 and sell it today you would earn a total of 42.00 from holding Cion Investment Corp or generate 3.72% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MFS High Income vs. Cion Investment Corp
Performance |
| Timeline |
| MFS High Income |
| Cion Investment Corp |
MFS High and Cion Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MFS High and Cion Investment
The main advantage of trading using opposite MFS High and Cion Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MFS High position performs unexpectedly, Cion Investment 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 Cion Investment will offset losses from the drop in Cion Investment's long position.| MFS High vs. MFS Investment Grade | MFS High vs. Eaton Vance National | MFS High vs. Blackrock Muniholdings Ny | MFS High vs. Nuveen California Select |
| Cion Investment vs. Federated Premier Municipal | Cion Investment vs. Blackrock Muniyield | Cion Investment vs. Diamond Hill Investment | Cion Investment vs. NXG NextGen Infrastructure |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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