Correlation Between MFS Investment and Blackrock Muni
Can any of the company-specific risk be diversified away by investing in both MFS Investment and Blackrock Muni 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 Blackrock Muni 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 Blackrock Muni Intermediate, you can compare the effects of market volatilities on MFS Investment and Blackrock Muni 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 Blackrock Muni. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFS Investment and Blackrock Muni.
Diversification Opportunities for MFS Investment and Blackrock Muni
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between MFS and Blackrock is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding MFS Investment Grade and Blackrock Muni Intermediate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Muni Inter 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 Blackrock Muni. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock Muni Inter has no effect on the direction of MFS Investment i.e., MFS Investment and Blackrock Muni go up and down completely randomly.
Pair Corralation between MFS Investment and Blackrock Muni
Considering the 90-day investment horizon MFS Investment is expected to generate 16.07 times less return on investment than Blackrock Muni. In addition to that, MFS Investment is 1.25 times more volatile than Blackrock Muni Intermediate. It trades about 0.0 of its total potential returns per unit of risk. Blackrock Muni Intermediate is currently generating about 0.05 per unit of volatility. If you would invest 1,214 in Blackrock Muni Intermediate on November 2, 2024 and sell it today you would earn a total of 5.00 from holding Blackrock Muni Intermediate or generate 0.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
MFS Investment Grade vs. Blackrock Muni Intermediate
Performance |
| Timeline |
| MFS Investment Grade |
| Blackrock Muni Inter |
MFS Investment and Blackrock Muni Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MFS Investment and Blackrock Muni
The main advantage of trading using opposite MFS Investment and Blackrock Muni positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MFS Investment position performs unexpectedly, Blackrock Muni 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 Blackrock Muni will offset losses from the drop in Blackrock Muni's long position.| MFS Investment vs. Eaton Vance National | MFS Investment vs. Nuveen California Select | MFS Investment vs. Federated Premier Municipal |
| Blackrock Muni vs. Blackrock Muniyield | Blackrock Muni vs. Blackrock Muniyield Quality | Blackrock Muni vs. Blackrock Muniyield Quality | Blackrock Muni vs. Blackrock Muniholdings Quality |
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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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