Correlation Between MFS Charter and CBH
Can any of the company-specific risk be diversified away by investing in both MFS Charter and CBH 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 Charter and CBH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MFS Charter Income and CBH, you can compare the effects of market volatilities on MFS Charter and CBH 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 Charter with a short position of CBH. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFS Charter and CBH.
Diversification Opportunities for MFS Charter and CBH
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MFS and CBH is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding MFS Charter Income and CBH in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CBH and MFS Charter 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 Charter Income are associated (or correlated) with CBH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CBH has no effect on the direction of MFS Charter i.e., MFS Charter and CBH go up and down completely randomly.
Pair Corralation between MFS Charter and CBH
Considering the 90-day investment horizon MFS Charter Income is expected to generate 1.79 times more return on investment than CBH. However, MFS Charter is 1.79 times more volatile than CBH. It trades about 0.04 of its potential returns per unit of risk. CBH is currently generating about 0.05 per unit of risk. If you would invest 545.00 in MFS Charter Income on August 31, 2024 and sell it today you would earn a total of 86.50 from holding MFS Charter Income or generate 15.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 86.82% |
| Values | Daily Returns |
MFS Charter Income vs. CBH
Performance |
| Timeline |
| MFS Charter Income |
| CBH |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
MFS Charter and CBH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MFS Charter and CBH
The main advantage of trading using opposite MFS Charter and CBH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MFS Charter position performs unexpectedly, CBH 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 CBH will offset losses from the drop in CBH's long position.| MFS Charter vs. MFS High Income | MFS Charter vs. MFS Investment Grade | MFS Charter vs. Eaton Vance National | MFS Charter vs. Invesco High Income |
| CBH vs. Eaton Vance National | CBH vs. Invesco High Income | CBH vs. Blackrock Muniholdings Ny | CBH vs. Nuveen California Select |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities |