Correlation Between International Business and MFS Special
Can any of the company-specific risk be diversified away by investing in both International Business and MFS Special 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 International Business and MFS Special into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between International Business Machines and MFS Special Value, you can compare the effects of market volatilities on International Business and MFS Special 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 International Business with a short position of MFS Special. Check out your portfolio center. Please also check ongoing floating volatility patterns of International Business and MFS Special.
Diversification Opportunities for International Business and MFS Special
-0.42 | Correlation Coefficient |
Very good diversification
The 3 months correlation between International and MFS is -0.42. Overlapping area represents the amount of risk that can be diversified away by holding International Business Machine and MFS Special Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MFS Special Value and International Business 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 International Business Machines are associated (or correlated) with MFS Special. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MFS Special Value has no effect on the direction of International Business i.e., International Business and MFS Special go up and down completely randomly.
Pair Corralation between International Business and MFS Special
Considering the 90-day investment horizon International Business Machines is expected to generate 2.03 times more return on investment than MFS Special. However, International Business is 2.03 times more volatile than MFS Special Value. It trades about 0.13 of its potential returns per unit of risk. MFS Special Value is currently generating about 0.12 per unit of risk. If you would invest 12,681 in International Business Machines on August 31, 2024 and sell it today you would earn a total of 10,060 from holding International Business Machines or generate 79.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 8.56% |
| Values | Daily Returns |
International Business Machine vs. MFS Special Value
Performance |
| Timeline |
| International Business |
| MFS Special Value |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
International Business and MFS Special Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with International Business and MFS Special
The main advantage of trading using opposite International Business and MFS Special positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International Business position performs unexpectedly, MFS Special 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 Special will offset losses from the drop in MFS Special's long position.| International Business vs. RLJ Lodging Trust | International Business vs. Aquagold International | International Business vs. Stepstone Group | International Business vs. Morningstar Unconstrained Allocation |
| MFS Special vs. Brookfield Business Corp | MFS Special vs. Elysee Development Corp | MFS Special vs. DWS Municipal Income | MFS Special vs. Blackrock Munivest |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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