Correlation Between Dreyfus/standish and Mfs Emerging
Can any of the company-specific risk be diversified away by investing in both Dreyfus/standish and Mfs Emerging 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 Dreyfus/standish and Mfs Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Dreyfusstandish Global Fixed and Mfs Emerging Markets, you can compare the effects of market volatilities on Dreyfus/standish and Mfs Emerging 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 Dreyfus/standish with a short position of Mfs Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dreyfus/standish and Mfs Emerging.
Diversification Opportunities for Dreyfus/standish and Mfs Emerging
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dreyfus/standish and Mfs is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Dreyfusstandish Global Fixed and Mfs Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Emerging Markets and Dreyfus/standish 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 Dreyfusstandish Global Fixed are associated (or correlated) with Mfs Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Emerging Markets has no effect on the direction of Dreyfus/standish i.e., Dreyfus/standish and Mfs Emerging go up and down completely randomly.
Pair Corralation between Dreyfus/standish and Mfs Emerging
Assuming the 90 days horizon Dreyfus/standish is expected to generate 1.29 times less return on investment than Mfs Emerging. But when comparing it to its historical volatility, Dreyfusstandish Global Fixed is 1.35 times less risky than Mfs Emerging. It trades about 0.09 of its potential returns per unit of risk. Mfs Emerging Markets is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 1,054 in Mfs Emerging Markets on September 1, 2024 and sell it today you would earn a total of 156.00 from holding Mfs Emerging Markets or generate 14.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dreyfusstandish Global Fixed vs. Mfs Emerging Markets
Performance |
| Timeline |
| Dreyfusstandish Global |
| Mfs Emerging Markets |
Dreyfus/standish and Mfs Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dreyfus/standish and Mfs Emerging
The main advantage of trading using opposite Dreyfus/standish and Mfs Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dreyfus/standish position performs unexpectedly, Mfs Emerging 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 Emerging will offset losses from the drop in Mfs Emerging's long position.| Dreyfus/standish vs. Gamco Global Telecommunications | Dreyfus/standish vs. Nuveen Arizona Municipal | Dreyfus/standish vs. Ishares Municipal Bond | Dreyfus/standish vs. Blrc Sgy Mnp |
| Mfs Emerging vs. Dreyfus Government Cash | Mfs Emerging vs. Ab Government Exchange | Mfs Emerging vs. Dws Government Money | Mfs Emerging vs. Virtus Seix Government |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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