Correlation Between Lord Abbett and Mfs International
Can any of the company-specific risk be diversified away by investing in both Lord Abbett and Mfs International 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 Lord Abbett and Mfs International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lord Abbett Govt and Mfs International Value, you can compare the effects of market volatilities on Lord Abbett and Mfs International 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 Lord Abbett with a short position of Mfs International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and Mfs International.
Diversification Opportunities for Lord Abbett and Mfs International
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lord and Mfs is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Govt and Mfs International Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs International Value and Lord Abbett 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 Lord Abbett Govt are associated (or correlated) with Mfs International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs International Value has no effect on the direction of Lord Abbett i.e., Lord Abbett and Mfs International go up and down completely randomly.
Pair Corralation between Lord Abbett and Mfs International
Assuming the 90 days horizon Lord Abbett is expected to generate 27.17 times less return on investment than Mfs International. But when comparing it to its historical volatility, Lord Abbett Govt is 1.4 times less risky than Mfs International. It trades about 0.0 of its potential returns per unit of risk. Mfs International Value is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 3,277 in Mfs International Value on September 3, 2024 and sell it today you would earn a total of 829.00 from holding Mfs International Value or generate 25.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 92.93% |
| Values | Daily Returns |
Lord Abbett Govt vs. Mfs International Value
Performance |
| Timeline |
| Lord Abbett Govt |
| Mfs International Value |
Lord Abbett and Mfs International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lord Abbett and Mfs International
The main advantage of trading using opposite Lord Abbett and Mfs International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lord Abbett position performs unexpectedly, Mfs International 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 International will offset losses from the drop in Mfs International's long position.| Lord Abbett vs. Vanguard Total Stock | Lord Abbett vs. Vanguard 500 Index | Lord Abbett vs. Vanguard Total Stock | Lord Abbett vs. Vanguard Total Stock |
| Mfs International vs. Fidelity International Growth | Mfs International vs. Fidelity Small Cap | Mfs International vs. Fidelity Advisor Mid | Mfs International vs. HUMANA INC |
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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