Correlation Between MFS High and Bny Mellon
Can any of the company-specific risk be diversified away by investing in both MFS High and Bny Mellon 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 Bny Mellon 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 Bny Mellon Alcentra, you can compare the effects of market volatilities on MFS High and Bny Mellon 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 Bny Mellon. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFS High and Bny Mellon.
Diversification Opportunities for MFS High and Bny Mellon
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between MFS and Bny is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding MFS High Income and Bny Mellon Alcentra in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bny Mellon Alcentra 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 Bny Mellon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bny Mellon Alcentra has no effect on the direction of MFS High i.e., MFS High and Bny Mellon go up and down completely randomly.
Pair Corralation between MFS High and Bny Mellon
Considering the 90-day investment horizon MFS High Income is expected to under-perform the Bny Mellon. In addition to that, MFS High is 3.67 times more volatile than Bny Mellon Alcentra. It trades about -0.03 of its total potential returns per unit of risk. Bny Mellon Alcentra is currently generating about 0.29 per unit of volatility. If you would invest 915.00 in Bny Mellon Alcentra on August 27, 2024 and sell it today you would earn a total of 9.00 from holding Bny Mellon Alcentra or generate 0.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 90.48% |
| Values | Daily Returns |
MFS High Income vs. Bny Mellon Alcentra
Performance |
| Timeline |
| MFS High Income |
| Bny Mellon Alcentra |
MFS High and Bny Mellon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MFS High and Bny Mellon
The main advantage of trading using opposite MFS High and Bny Mellon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MFS High position performs unexpectedly, Bny Mellon 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 Bny Mellon will offset losses from the drop in Bny Mellon'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 |
| Bny Mellon vs. MFS Investment Grade | Bny Mellon vs. MFS High Yield | Bny Mellon vs. MFS High Income | Bny Mellon vs. The Gabelli Multimedia |
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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