Correlation Between Scharf Fund and Mfs Maryland
Can any of the company-specific risk be diversified away by investing in both Scharf Fund and Mfs Maryland 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 Scharf Fund and Mfs Maryland into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Scharf Fund Retail and Mfs Maryland Municipal, you can compare the effects of market volatilities on Scharf Fund and Mfs Maryland 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 Scharf Fund with a short position of Mfs Maryland. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scharf Fund and Mfs Maryland.
Diversification Opportunities for Scharf Fund and Mfs Maryland
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Scharf and Mfs is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Scharf Fund Retail and Mfs Maryland Municipal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Maryland Municipal and Scharf Fund 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 Scharf Fund Retail are associated (or correlated) with Mfs Maryland. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Maryland Municipal has no effect on the direction of Scharf Fund i.e., Scharf Fund and Mfs Maryland go up and down completely randomly.
Pair Corralation between Scharf Fund and Mfs Maryland
Assuming the 90 days horizon Scharf Fund Retail is expected to generate 2.74 times more return on investment than Mfs Maryland. However, Scharf Fund is 2.74 times more volatile than Mfs Maryland Municipal. It trades about 0.08 of its potential returns per unit of risk. Mfs Maryland Municipal is currently generating about 0.05 per unit of risk. If you would invest 5,205 in Scharf Fund Retail on September 14, 2024 and sell it today you would earn a total of 329.00 from holding Scharf Fund Retail or generate 6.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Scharf Fund Retail vs. Mfs Maryland Municipal
Performance |
| Timeline |
| Scharf Fund Retail |
| Mfs Maryland Municipal |
Scharf Fund and Mfs Maryland Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scharf Fund and Mfs Maryland
The main advantage of trading using opposite Scharf Fund and Mfs Maryland positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scharf Fund position performs unexpectedly, Mfs Maryland 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 Maryland will offset losses from the drop in Mfs Maryland's long position.| Scharf Fund vs. Cmg Ultra Short | Scharf Fund vs. Blackrock Short Term Inflat Protected | Scharf Fund vs. Quantitative Longshort Equity | Scharf Fund vs. Virtus Multi Sector Short |
| Mfs Maryland vs. Cutler Equity | Mfs Maryland vs. Dodge International Stock | Mfs Maryland vs. Scharf Fund Retail | Mfs Maryland vs. Us Vector Equity |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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