Correlation Between MFS Investment and Chesapeake Finl
Can any of the company-specific risk be diversified away by investing in both MFS Investment and Chesapeake Finl 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 Chesapeake Finl 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 Chesapeake Finl Shs, you can compare the effects of market volatilities on MFS Investment and Chesapeake Finl 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 Chesapeake Finl. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFS Investment and Chesapeake Finl.
Diversification Opportunities for MFS Investment and Chesapeake Finl
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between MFS and Chesapeake is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding MFS Investment Grade and Chesapeake Finl Shs in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chesapeake Finl Shs 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 Chesapeake Finl. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chesapeake Finl Shs has no effect on the direction of MFS Investment i.e., MFS Investment and Chesapeake Finl go up and down completely randomly.
Pair Corralation between MFS Investment and Chesapeake Finl
Considering the 90-day investment horizon MFS Investment Grade is expected to generate 0.24 times more return on investment than Chesapeake Finl. However, MFS Investment Grade is 4.09 times less risky than Chesapeake Finl. It trades about 0.11 of its potential returns per unit of risk. Chesapeake Finl Shs is currently generating about 0.02 per unit of risk. If you would invest 734.00 in MFS Investment Grade on August 29, 2024 and sell it today you would earn a total of 77.00 from holding MFS Investment Grade or generate 10.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 86.12% |
| Values | Daily Returns |
MFS Investment Grade vs. Chesapeake Finl Shs
Performance |
| Timeline |
| MFS Investment Grade |
| Chesapeake Finl Shs |
MFS Investment and Chesapeake Finl Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MFS Investment and Chesapeake Finl
The main advantage of trading using opposite MFS Investment and Chesapeake Finl positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MFS Investment position performs unexpectedly, Chesapeake Finl 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 Chesapeake Finl will offset losses from the drop in Chesapeake Finl's long position.| MFS Investment vs. Invesco High Income | MFS Investment vs. Eaton Vance National | MFS Investment vs. Nuveen California Select | MFS Investment vs. Federated Premier Municipal |
| Chesapeake Finl vs. Invesco High Income | Chesapeake Finl vs. Blackrock Muniholdings Ny | Chesapeake Finl vs. Nuveen California Select | Chesapeake Finl vs. MFS Investment Grade |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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