Correlation Between MFS Investment and Abrdn Emerging
Can any of the company-specific risk be diversified away by investing in both MFS Investment and Abrdn Emerging 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 Investment and Abrdn Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MFS Investment Grade and Abrdn Emerging Markets, you can compare the effects of market volatilities on MFS Investment and Abrdn Emerging 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 Investment with a short position of Abrdn Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFS Investment and Abrdn Emerging.
Diversification Opportunities for MFS Investment and Abrdn Emerging
0.33 | Correlation Coefficient |
Weak diversification
The 3 months correlation between MFS and Abrdn is 0.33. Overlapping area represents the amount of risk that can be diversified away by holding MFS Investment Grade and Abrdn Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Abrdn Emerging Markets and MFS Investment 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 Investment Grade are associated (or correlated) with Abrdn Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Abrdn Emerging Markets has no effect on the direction of MFS Investment i.e., MFS Investment and Abrdn Emerging go up and down completely randomly.
Pair Corralation between MFS Investment and Abrdn Emerging
Considering the 90-day investment horizon MFS Investment Grade is expected to generate 0.55 times more return on investment than Abrdn Emerging. However, MFS Investment Grade is 1.81 times less risky than Abrdn Emerging. It trades about 0.06 of its potential returns per unit of risk. Abrdn Emerging Markets is currently generating about 0.03 per unit of risk. If you would invest 676.00 in MFS Investment Grade on August 28, 2024 and sell it today you would earn a total of 137.00 from holding MFS Investment Grade or generate 20.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
MFS Investment Grade vs. Abrdn Emerging Markets
Performance |
| Timeline |
| MFS Investment Grade |
| Abrdn Emerging Markets |
MFS Investment and Abrdn Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MFS Investment and Abrdn Emerging
The main advantage of trading using opposite MFS Investment and Abrdn Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MFS Investment position performs unexpectedly, Abrdn Emerging 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 Abrdn Emerging will offset losses from the drop in Abrdn Emerging's long position.| MFS Investment vs. Aurora Innovation | MFS Investment vs. HUMANA INC | MFS Investment vs. Aquagold International | MFS Investment vs. Barloworld Ltd ADR |
| Abrdn Emerging vs. DWS Municipal Income | Abrdn Emerging vs. Blackrock Muni Intermediate | Abrdn Emerging vs. Blackrock Muniyield | Abrdn Emerging vs. Flow Capital Corp |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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