Correlation Between Lord Abbett and Mfs Technology
Can any of the company-specific risk be diversified away by investing in both Lord Abbett and Mfs Technology 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 Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Lord Abbett Growth and Mfs Technology Fund, you can compare the effects of market volatilities on Lord Abbett and Mfs Technology 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 Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lord Abbett and Mfs Technology.
Diversification Opportunities for Lord Abbett and Mfs Technology
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Lord and MFS is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Lord Abbett Growth and Mfs Technology Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Technology 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 Growth are associated (or correlated) with Mfs Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Technology has no effect on the direction of Lord Abbett i.e., Lord Abbett and Mfs Technology go up and down completely randomly.
Pair Corralation between Lord Abbett and Mfs Technology
Assuming the 90 days horizon Lord Abbett Growth is expected to generate 1.02 times more return on investment than Mfs Technology. However, Lord Abbett is 1.02 times more volatile than Mfs Technology Fund. It trades about 0.1 of its potential returns per unit of risk. Mfs Technology Fund is currently generating about 0.1 per unit of risk. If you would invest 2,699 in Lord Abbett Growth on August 29, 2024 and sell it today you would earn a total of 2,242 from holding Lord Abbett Growth or generate 83.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lord Abbett Growth vs. Mfs Technology Fund
Performance |
| Timeline |
| Lord Abbett Growth |
| Mfs Technology |
Lord Abbett and Mfs Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lord Abbett and Mfs Technology
The main advantage of trading using opposite Lord Abbett and Mfs Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lord Abbett position performs unexpectedly, Mfs Technology 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 Technology will offset losses from the drop in Mfs Technology's long position.| Lord Abbett vs. Mfs Technology Fund | Lord Abbett vs. Allianzgi Technology Fund | Lord Abbett vs. Dreyfus Technology Growth | Lord Abbett vs. Janus Global Technology |
| Mfs Technology vs. Live Oak Health | Mfs Technology vs. HUMANA INC | Mfs Technology vs. Aquagold International | Mfs Technology vs. Barloworld Ltd ADR |
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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