Correlation Between MFS Investment and Source Capital
Can any of the company-specific risk be diversified away by investing in both MFS Investment and Source Capital 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 Source Capital 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 Source Capital Closed, you can compare the effects of market volatilities on MFS Investment and Source Capital 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 Source Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFS Investment and Source Capital.
Diversification Opportunities for MFS Investment and Source Capital
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MFS and Source is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding MFS Investment Grade and Source Capital Closed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Source Capital Closed 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 Source Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Source Capital Closed has no effect on the direction of MFS Investment i.e., MFS Investment and Source Capital go up and down completely randomly.
Pair Corralation between MFS Investment and Source Capital
Considering the 90-day investment horizon MFS Investment Grade is expected to generate 0.56 times more return on investment than Source Capital. However, MFS Investment Grade is 1.8 times less risky than Source Capital. It trades about 0.22 of its potential returns per unit of risk. Source Capital Closed is currently generating about 0.07 per unit of risk. If you would invest 796.00 in MFS Investment Grade on November 8, 2024 and sell it today you would earn a total of 19.00 from holding MFS Investment Grade or generate 2.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MFS Investment Grade vs. Source Capital Closed
Performance |
| Timeline |
| MFS Investment Grade |
| Source Capital Closed |
MFS Investment and Source Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MFS Investment and Source Capital
The main advantage of trading using opposite MFS Investment and Source Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MFS Investment position performs unexpectedly, Source Capital 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 Source Capital will offset losses from the drop in Source Capital's long position.| MFS Investment vs. Marblegate Acquisition Corp | MFS Investment vs. Alpha One | MFS Investment vs. Manaris Corp |
| Source Capital vs. DTF Tax Free | Source Capital vs. MFS Investment Grade | Source Capital vs. Eaton Vance National | Source Capital vs. Nuveen California Select |
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 Stocks Directory module to find actively traded stocks across global markets.
Other Complementary Tools
| My Watchlist Analysis Analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like | |
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |