Correlation Between Mfs Emerging and Mfs Blended
Can any of the company-specific risk be diversified away by investing in both Mfs Emerging and Mfs Blended 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 Emerging and Mfs Blended into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mfs Emerging Markets and Mfs Blended Research, you can compare the effects of market volatilities on Mfs Emerging and Mfs Blended 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 Emerging with a short position of Mfs Blended. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mfs Emerging and Mfs Blended.
Diversification Opportunities for Mfs Emerging and Mfs Blended
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Mfs and Mfs is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Mfs Emerging Markets and Mfs Blended Research in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Blended Research and Mfs Emerging 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 Emerging Markets are associated (or correlated) with Mfs Blended. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Blended Research has no effect on the direction of Mfs Emerging i.e., Mfs Emerging and Mfs Blended go up and down completely randomly.
Pair Corralation between Mfs Emerging and Mfs Blended
Assuming the 90 days horizon Mfs Emerging is expected to generate 2.71 times less return on investment than Mfs Blended. But when comparing it to its historical volatility, Mfs Emerging Markets is 1.64 times less risky than Mfs Blended. It trades about 0.05 of its potential returns per unit of risk. Mfs Blended Research is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,332 in Mfs Blended Research on September 4, 2024 and sell it today you would earn a total of 435.00 from holding Mfs Blended Research or generate 32.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mfs Emerging Markets vs. Mfs Blended Research
Performance |
| Timeline |
| Mfs Emerging Markets |
| Mfs Blended Research |
Mfs Emerging and Mfs Blended Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mfs Emerging and Mfs Blended
The main advantage of trading using opposite Mfs Emerging and Mfs Blended positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mfs Emerging position performs unexpectedly, Mfs Blended 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 Blended will offset losses from the drop in Mfs Blended's long position.| Mfs Emerging vs. Mfs Prudent Investor | Mfs Emerging vs. Mfs Prudent Investor | Mfs Emerging vs. Mfs Prudent Investor | Mfs Emerging vs. Mfs Prudent Investor |
| Mfs Blended vs. Fidelity Sai Convertible | Mfs Blended vs. Rationalpier 88 Convertible | Mfs Blended vs. Putnam Convertible Incm Gwth | Mfs Blended vs. Virtus Convertible |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Commodity Channel Use Commodity Channel Index to analyze current equity momentum | |
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Investing Opportunities Build portfolios using our predefined set of ideas and optimize them against your investing preferences | |
| Price Exposure Probability Analyze equity upside and downside potential for a given time horizon across multiple markets | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |