Correlation Between MFS High and Virtus AllianzGI
Can any of the company-specific risk be diversified away by investing in both MFS High and Virtus AllianzGI 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 Virtus AllianzGI 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 Virtus AllianzGI Convertible, you can compare the effects of market volatilities on MFS High and Virtus AllianzGI 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 Virtus AllianzGI. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFS High and Virtus AllianzGI.
Diversification Opportunities for MFS High and Virtus AllianzGI
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between MFS and Virtus is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding MFS High Income and Virtus AllianzGI Convertible in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Virtus AllianzGI Con 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 Virtus AllianzGI. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Virtus AllianzGI Con has no effect on the direction of MFS High i.e., MFS High and Virtus AllianzGI go up and down completely randomly.
Pair Corralation between MFS High and Virtus AllianzGI
Considering the 90-day investment horizon MFS High Income is expected to generate 0.8 times more return on investment than Virtus AllianzGI. However, MFS High Income is 1.26 times less risky than Virtus AllianzGI. It trades about 0.12 of its potential returns per unit of risk. Virtus AllianzGI Convertible is currently generating about -0.09 per unit of risk. If you would invest 382.00 in MFS High Income on September 1, 2024 and sell it today you would earn a total of 6.00 from holding MFS High Income or generate 1.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MFS High Income vs. Virtus AllianzGI Convertible
Performance |
| Timeline |
| MFS High Income |
| Virtus AllianzGI Con |
MFS High and Virtus AllianzGI Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MFS High and Virtus AllianzGI
The main advantage of trading using opposite MFS High and Virtus AllianzGI positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MFS High position performs unexpectedly, Virtus AllianzGI 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 Virtus AllianzGI will offset losses from the drop in Virtus AllianzGI'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 |
| Virtus AllianzGI vs. The Gabelli Equity | Virtus AllianzGI vs. The Gabelli Equity | Virtus AllianzGI vs. Oxford Lane Capital | Virtus AllianzGI vs. The Gabelli Utility |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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