Correlation Between Transamerica Financial and Mfs Blended
Can any of the company-specific risk be diversified away by investing in both Transamerica Financial 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 Transamerica Financial and Mfs Blended into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Transamerica Financial Life and Mfs Blended Research, you can compare the effects of market volatilities on Transamerica Financial 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 Transamerica Financial with a short position of Mfs Blended. Check out your portfolio center. Please also check ongoing floating volatility patterns of Transamerica Financial and Mfs Blended.
Diversification Opportunities for Transamerica Financial and Mfs Blended
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Transamerica and Mfs is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Transamerica Financial Life 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 Transamerica Financial 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 Transamerica Financial Life 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 Transamerica Financial i.e., Transamerica Financial and Mfs Blended go up and down completely randomly.
Pair Corralation between Transamerica Financial and Mfs Blended
Assuming the 90 days horizon Transamerica Financial is expected to generate 1.24 times less return on investment than Mfs Blended. But when comparing it to its historical volatility, Transamerica Financial Life is 1.74 times less risky than Mfs Blended. It trades about 0.09 of its potential returns per unit of risk. Mfs Blended Research is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,505 in Mfs Blended Research on September 3, 2024 and sell it today you would earn a total of 183.00 from holding Mfs Blended Research or generate 12.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Transamerica Financial Life vs. Mfs Blended Research
Performance |
| Timeline |
| Transamerica Financial |
| Mfs Blended Research |
Transamerica Financial and Mfs Blended Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Transamerica Financial and Mfs Blended
The main advantage of trading using opposite Transamerica Financial and Mfs Blended positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Transamerica Financial 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.| Transamerica Financial vs. Aig Government Money | Transamerica Financial vs. John Hancock Money | Transamerica Financial vs. First American Funds | Transamerica Financial vs. Matson Money Equity |
| Mfs Blended vs. Templeton Developing Markets | Mfs Blended vs. Massmutual Select Diversified | Mfs Blended vs. The Hartford Emerging | Mfs Blended vs. Mondrian Emerging Markets |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Portfolio Anywhere Track or share privately all of your investments from the convenience of any device | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Economic Indicators Top statistical indicators that provide insights into how an economy is performing | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk |