Correlation Between IHIT and MFS High
Can any of the company-specific risk be diversified away by investing in both IHIT and MFS High 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 IHIT and MFS High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between IHIT and MFS High Yield, you can compare the effects of market volatilities on IHIT and MFS High 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 IHIT with a short position of MFS High. Check out your portfolio center. Please also check ongoing floating volatility patterns of IHIT and MFS High.
Diversification Opportunities for IHIT and MFS High
Modest diversification
The 3 months correlation between IHIT and MFS is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding IHIT and MFS High Yield in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MFS High Yield and IHIT 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 IHIT are associated (or correlated) with MFS High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MFS High Yield has no effect on the direction of IHIT i.e., IHIT and MFS High go up and down completely randomly.
Pair Corralation between IHIT and MFS High
If you would invest 347.00 in MFS High Yield on October 20, 2024 and sell it today you would earn a total of 4.00 from holding MFS High Yield or generate 1.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 5.0% |
| Values | Daily Returns |
IHIT vs. MFS High Yield
Performance |
| Timeline |
| IHIT |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| MFS High Yield |
IHIT and MFS High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with IHIT and MFS High
The main advantage of trading using opposite IHIT and MFS High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if IHIT position performs unexpectedly, MFS High 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 High will offset losses from the drop in MFS High's long position.| IHIT vs. MFS Investment Grade | IHIT vs. Eaton Vance National | IHIT vs. Nuveen California Select | IHIT vs. Federated Premier Municipal |
| MFS High vs. MFS Investment Grade | MFS High vs. MFS Municipal Income | MFS High vs. DTF Tax Free | MFS High vs. MFS Government 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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