Correlation Between Empire State and Mfs Value
Can any of the company-specific risk be diversified away by investing in both Empire State and Mfs Value 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 Empire State and Mfs Value into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Empire State Realty and Mfs Value Fund, you can compare the effects of market volatilities on Empire State and Mfs Value 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 Empire State with a short position of Mfs Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of Empire State and Mfs Value.
Diversification Opportunities for Empire State and Mfs Value
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Empire and Mfs is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Empire State Realty and Mfs Value Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Value Fund and Empire State 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 Empire State Realty are associated (or correlated) with Mfs Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Value Fund has no effect on the direction of Empire State i.e., Empire State and Mfs Value go up and down completely randomly.
Pair Corralation between Empire State and Mfs Value
Given the investment horizon of 90 days Empire State is expected to generate 1.7 times less return on investment than Mfs Value. In addition to that, Empire State is 1.74 times more volatile than Mfs Value Fund. It trades about 0.04 of its total potential returns per unit of risk. Mfs Value Fund is currently generating about 0.11 per unit of volatility. If you would invest 5,383 in Mfs Value Fund on August 29, 2024 and sell it today you would earn a total of 163.00 from holding Mfs Value Fund or generate 3.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Empire State Realty vs. Mfs Value Fund
Performance |
| Timeline |
| Empire State Realty |
| Mfs Value Fund |
Empire State and Mfs Value Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Empire State and Mfs Value
The main advantage of trading using opposite Empire State and Mfs Value positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Empire State position performs unexpectedly, Mfs Value 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 Value will offset losses from the drop in Mfs Value's long position.| Empire State vs. Paramount Group | Empire State vs. Hudson Pacific Properties | Empire State vs. Equity Commonwealth | Empire State vs. Douglas Emmett |
| Mfs Value vs. Mfs Growth Fund | Mfs Value vs. Prudential Total Return | Mfs Value vs. Mfs International Diversification | Mfs Value vs. Mfs Mid Cap |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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