Correlation Between MFS Investment and Sprott
Can any of the company-specific risk be diversified away by investing in both MFS Investment and Sprott 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 Sprott 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 Sprott, you can compare the effects of market volatilities on MFS Investment and Sprott 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 Sprott. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFS Investment and Sprott.
Diversification Opportunities for MFS Investment and Sprott
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between MFS and Sprott is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding MFS Investment Grade and Sprott in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sprott 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 Sprott. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sprott has no effect on the direction of MFS Investment i.e., MFS Investment and Sprott go up and down completely randomly.
Pair Corralation between MFS Investment and Sprott
Considering the 90-day investment horizon MFS Investment is expected to generate 1.64 times less return on investment than Sprott. But when comparing it to its historical volatility, MFS Investment Grade is 1.23 times less risky than Sprott. It trades about 0.05 of its potential returns per unit of risk. Sprott is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 3,540 in Sprott on August 27, 2024 and sell it today you would earn a total of 355.00 from holding Sprott or generate 10.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 31.85% |
| Values | Daily Returns |
MFS Investment Grade vs. Sprott
Performance |
| Timeline |
| MFS Investment Grade |
| Sprott |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
MFS Investment and Sprott Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MFS Investment and Sprott
The main advantage of trading using opposite MFS Investment and Sprott positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MFS Investment position performs unexpectedly, Sprott 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 Sprott will offset losses from the drop in Sprott's long position.| MFS Investment vs. PowerUp Acquisition Corp | MFS Investment vs. Aurora Innovation | MFS Investment vs. HUMANA INC | MFS Investment vs. Aquagold International |
| Sprott vs. Blackrock Muniholdings Ny | Sprott vs. MFS Investment Grade | Sprott vs. Eaton Vance National | Sprott vs. Invesco High Income |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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