Correlation Between MFS Investment and Neffs Bancorp
Can any of the company-specific risk be diversified away by investing in both MFS Investment and Neffs Bancorp 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 Neffs Bancorp 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 Neffs Bancorp, you can compare the effects of market volatilities on MFS Investment and Neffs Bancorp 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 Neffs Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFS Investment and Neffs Bancorp.
Diversification Opportunities for MFS Investment and Neffs Bancorp
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between MFS and Neffs is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding MFS Investment Grade and Neffs Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Neffs Bancorp 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 Neffs Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Neffs Bancorp has no effect on the direction of MFS Investment i.e., MFS Investment and Neffs Bancorp go up and down completely randomly.
Pair Corralation between MFS Investment and Neffs Bancorp
Considering the 90-day investment horizon MFS Investment Grade is expected to generate 0.17 times more return on investment than Neffs Bancorp. However, MFS Investment Grade is 6.05 times less risky than Neffs Bancorp. It trades about 0.07 of its potential returns per unit of risk. Neffs Bancorp is currently generating about 0.0 per unit of risk. If you would invest 689.00 in MFS Investment Grade on August 29, 2024 and sell it today you would earn a total of 122.00 from holding MFS Investment Grade or generate 17.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 63.36% |
| Values | Daily Returns |
MFS Investment Grade vs. Neffs Bancorp
Performance |
| Timeline |
| MFS Investment Grade |
| Neffs Bancorp |
MFS Investment and Neffs Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MFS Investment and Neffs Bancorp
The main advantage of trading using opposite MFS Investment and Neffs Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MFS Investment position performs unexpectedly, Neffs Bancorp 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 Neffs Bancorp will offset losses from the drop in Neffs Bancorp's long position.| MFS Investment vs. Aurora Innovation | MFS Investment vs. HUMANA INC | MFS Investment vs. Aquagold International | MFS Investment vs. Barloworld Ltd ADR |
| Neffs Bancorp vs. Invesco High Income | Neffs Bancorp vs. Blackrock Muniholdings Ny | Neffs Bancorp vs. MFS Investment Grade | Neffs Bancorp vs. Federated Premier Municipal |
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 Valuation module to check real value of public entities based on technical and fundamental data.
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