Correlation Between Mfs Lifetime and Mfs Blended
Can any of the company-specific risk be diversified away by investing in both Mfs Lifetime 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 Mfs Lifetime and Mfs Blended into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mfs Lifetime 2065 and Mfs Blended Research, you can compare the effects of market volatilities on Mfs Lifetime 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 Mfs Lifetime with a short position of Mfs Blended. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mfs Lifetime and Mfs Blended.
Diversification Opportunities for Mfs Lifetime and Mfs Blended
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Mfs and Mfs is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Mfs Lifetime 2065 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 Mfs Lifetime 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 Mfs Lifetime 2065 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 Mfs Lifetime i.e., Mfs Lifetime and Mfs Blended go up and down completely randomly.
Pair Corralation between Mfs Lifetime and Mfs Blended
Assuming the 90 days horizon Mfs Lifetime is expected to generate 6.02 times less return on investment than Mfs Blended. But when comparing it to its historical volatility, Mfs Lifetime 2065 is 2.66 times less risky than Mfs Blended. It trades about 0.11 of its potential returns per unit of risk. Mfs Blended Research is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 1,600 in Mfs Blended Research on August 28, 2024 and sell it today you would earn a total of 134.00 from holding Mfs Blended Research or generate 8.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mfs Lifetime 2065 vs. Mfs Blended Research
Performance |
| Timeline |
| Mfs Lifetime 2065 |
| Mfs Blended Research |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
Mfs Lifetime and Mfs Blended Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mfs Lifetime and Mfs Blended
The main advantage of trading using opposite Mfs Lifetime and Mfs Blended positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mfs Lifetime 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.| Mfs Lifetime vs. Mfs Prudent Investor | Mfs Lifetime vs. Mfs Prudent Investor | Mfs Lifetime vs. Mfs Prudent Investor | Mfs Lifetime vs. Mfs Prudent Investor |
| Mfs Blended vs. Real Estate Fund | Mfs Blended vs. Columbia Real Estate | Mfs Blended vs. Dunham Real Estate | Mfs Blended vs. Dunham Real Estate |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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