Correlation Between Enel Chile and Mfs Utilities
Can any of the company-specific risk be diversified away by investing in both Enel Chile and Mfs Utilities 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 Enel Chile and Mfs Utilities into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Enel Chile SA and Mfs Utilities Fund, you can compare the effects of market volatilities on Enel Chile and Mfs Utilities 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 Enel Chile with a short position of Mfs Utilities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Enel Chile and Mfs Utilities.
Diversification Opportunities for Enel Chile and Mfs Utilities
-0.69 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Enel and Mfs is -0.69. Overlapping area represents the amount of risk that can be diversified away by holding Enel Chile SA and Mfs Utilities Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Utilities and Enel Chile 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 Enel Chile SA are associated (or correlated) with Mfs Utilities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Utilities has no effect on the direction of Enel Chile i.e., Enel Chile and Mfs Utilities go up and down completely randomly.
Pair Corralation between Enel Chile and Mfs Utilities
Given the investment horizon of 90 days Enel Chile SA is expected to generate 0.99 times more return on investment than Mfs Utilities. However, Enel Chile SA is 1.01 times less risky than Mfs Utilities. It trades about 0.19 of its potential returns per unit of risk. Mfs Utilities Fund is currently generating about 0.01 per unit of risk. If you would invest 286.00 in Enel Chile SA on November 2, 2024 and sell it today you would earn a total of 14.00 from holding Enel Chile SA or generate 4.9% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Enel Chile SA vs. Mfs Utilities Fund
Performance |
Timeline |
Enel Chile SA |
Mfs Utilities |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Enel Chile and Mfs Utilities Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Enel Chile and Mfs Utilities
The main advantage of trading using opposite Enel Chile and Mfs Utilities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Enel Chile position performs unexpectedly, Mfs Utilities 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 Utilities will offset losses from the drop in Mfs Utilities' long position.Enel Chile vs. Centrais Eltricas Brasileiras | Enel Chile vs. Korea Electric Power | Enel Chile vs. Central Puerto SA | Enel Chile vs. CMS Energy |
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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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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