Correlation Between BNY Mellon and MFS High
Can any of the company-specific risk be diversified away by investing in both BNY Mellon and MFS High 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 BNY Mellon and MFS High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between BNY Mellon High and MFS High Yield, you can compare the effects of market volatilities on BNY Mellon and MFS High 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 BNY Mellon with a short position of MFS High. Check out your portfolio center. Please also check ongoing floating volatility patterns of BNY Mellon and MFS High.
Diversification Opportunities for BNY Mellon and MFS High
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between BNY and MFS is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding BNY Mellon High and MFS High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MFS High Yield and BNY Mellon 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 BNY Mellon High are associated (or correlated) with MFS High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MFS High Yield has no effect on the direction of BNY Mellon i.e., BNY Mellon and MFS High go up and down completely randomly.
Pair Corralation between BNY Mellon and MFS High
Considering the 90-day investment horizon BNY Mellon High is expected to generate 1.09 times more return on investment than MFS High. However, BNY Mellon is 1.09 times more volatile than MFS High Yield. It trades about 0.22 of its potential returns per unit of risk. MFS High Yield is currently generating about 0.02 per unit of risk. If you would invest 256.00 in BNY Mellon High on August 27, 2024 and sell it today you would earn a total of 9.00 from holding BNY Mellon High or generate 3.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
BNY Mellon High vs. MFS High Yield
Performance |
| Timeline |
| BNY Mellon High |
| MFS High Yield |
BNY Mellon and MFS High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BNY Mellon and MFS High
The main advantage of trading using opposite BNY Mellon and MFS High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BNY Mellon position performs unexpectedly, MFS High 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 MFS High will offset losses from the drop in MFS High's long position.| BNY Mellon vs. Credit Suisse Asset | BNY Mellon vs. Mfs Intermediate High | BNY Mellon vs. Eaton Vance Risk | BNY Mellon vs. Nuveen Floating Rate |
| MFS High vs. PowerUp Acquisition Corp | MFS High vs. Aurora Innovation | MFS High vs. HUMANA INC | MFS High vs. Aquagold International |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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