Correlation Between MFS Investment and Global X
Can any of the company-specific risk be diversified away by investing in both MFS Investment and Global X 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 Global X 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 Global X Funds, you can compare the effects of market volatilities on MFS Investment and Global X 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 Global X. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFS Investment and Global X.
Diversification Opportunities for MFS Investment and Global X
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between MFS and Global is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding MFS Investment Grade and Global X Funds in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global X Funds 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 Global X. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global X Funds has no effect on the direction of MFS Investment i.e., MFS Investment and Global X go up and down completely randomly.
Pair Corralation between MFS Investment and Global X
Considering the 90-day investment horizon MFS Investment Grade is expected to generate 1.68 times more return on investment than Global X. However, MFS Investment is 1.68 times more volatile than Global X Funds. It trades about 0.0 of its potential returns per unit of risk. Global X Funds is currently generating about -0.19 per unit of risk. If you would invest 817.00 in MFS Investment Grade on August 29, 2024 and sell it today you would lose (1.00) from holding MFS Investment Grade or give up 0.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 97.67% |
| Values | Daily Returns |
MFS Investment Grade vs. Global X Funds
Performance |
| Timeline |
| MFS Investment Grade |
| Global X Funds |
MFS Investment and Global X Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MFS Investment and Global X
The main advantage of trading using opposite MFS Investment and Global X positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MFS Investment position performs unexpectedly, Global X 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 Global X will offset losses from the drop in Global X'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 |
| Global X vs. Vanguard Total Stock | Global X vs. SPDR SP 500 | Global X vs. iShares Core SP | Global X vs. Vanguard Total Bond |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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