Correlation Between Mfs International and Global Multi-strategy
Can any of the company-specific risk be diversified away by investing in both Mfs International and Global Multi-strategy 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 International and Global Multi-strategy into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mfs International Diversification and Global Multi Strategy Fund, you can compare the effects of market volatilities on Mfs International and Global Multi-strategy 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 International with a short position of Global Multi-strategy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mfs International and Global Multi-strategy.
Diversification Opportunities for Mfs International and Global Multi-strategy
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Mfs and Global is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Mfs International Diversificat and Global Multi Strategy Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Multi Strategy and Mfs International 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 International Diversification are associated (or correlated) with Global Multi-strategy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Multi Strategy has no effect on the direction of Mfs International i.e., Mfs International and Global Multi-strategy go up and down completely randomly.
Pair Corralation between Mfs International and Global Multi-strategy
Assuming the 90 days horizon Mfs International Diversification is expected to generate 2.15 times more return on investment than Global Multi-strategy. However, Mfs International is 2.15 times more volatile than Global Multi Strategy Fund. It trades about 0.06 of its potential returns per unit of risk. Global Multi Strategy Fund is currently generating about 0.05 per unit of risk. If you would invest 1,987 in Mfs International Diversification on September 3, 2024 and sell it today you would earn a total of 432.00 from holding Mfs International Diversification or generate 21.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mfs International Diversificat vs. Global Multi Strategy Fund
Performance |
| Timeline |
| Mfs International |
| Global Multi Strategy |
Mfs International and Global Multi-strategy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mfs International and Global Multi-strategy
The main advantage of trading using opposite Mfs International and Global Multi-strategy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mfs International position performs unexpectedly, Global Multi-strategy 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 Global Multi-strategy will offset losses from the drop in Global Multi-strategy's long position.| Mfs International vs. Mfs Growth Fund | Mfs International vs. Prudential Total Return | Mfs International vs. Mfs Value Fund | Mfs International vs. John Hancock Bond |
| Global Multi-strategy vs. Columbia Real Estate | Global Multi-strategy vs. Columbia Real Estate | Global Multi-strategy vs. Us Real Estate | Global Multi-strategy vs. Prudential 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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