Correlation Between Cutler Equity and Mfs Maryland
Can any of the company-specific risk be diversified away by investing in both Cutler Equity and Mfs Maryland 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 Cutler Equity and Mfs Maryland into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cutler Equity and Mfs Maryland Municipal, you can compare the effects of market volatilities on Cutler Equity and Mfs Maryland 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 Cutler Equity with a short position of Mfs Maryland. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cutler Equity and Mfs Maryland.
Diversification Opportunities for Cutler Equity and Mfs Maryland
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Cutler and Mfs is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Cutler Equity and Mfs Maryland Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Maryland Municipal and Cutler Equity 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 Cutler Equity are associated (or correlated) with Mfs Maryland. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Maryland Municipal has no effect on the direction of Cutler Equity i.e., Cutler Equity and Mfs Maryland go up and down completely randomly.
Pair Corralation between Cutler Equity and Mfs Maryland
Assuming the 90 days horizon Cutler Equity is expected to generate 2.85 times more return on investment than Mfs Maryland. However, Cutler Equity is 2.85 times more volatile than Mfs Maryland Municipal. It trades about 0.13 of its potential returns per unit of risk. Mfs Maryland Municipal is currently generating about 0.05 per unit of risk. If you would invest 2,595 in Cutler Equity on September 14, 2024 and sell it today you would earn a total of 279.00 from holding Cutler Equity or generate 10.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cutler Equity vs. Mfs Maryland Municipal
Performance |
| Timeline |
| Cutler Equity |
| Mfs Maryland Municipal |
Cutler Equity and Mfs Maryland Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cutler Equity and Mfs Maryland
The main advantage of trading using opposite Cutler Equity and Mfs Maryland positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cutler Equity position performs unexpectedly, Mfs Maryland 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 Maryland will offset losses from the drop in Mfs Maryland's long position.| Cutler Equity vs. Short Term Government Fund | Cutler Equity vs. Franklin Adjustable Government | Cutler Equity vs. Payden Government Fund | Cutler Equity vs. Intermediate Government Bond |
| Mfs Maryland vs. Cutler Equity | Mfs Maryland vs. Dodge International Stock | Mfs Maryland vs. Scharf Fund Retail | Mfs Maryland vs. Us Vector Equity |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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