Correlation Between Mfs Emerging and Baron Emerging
Can any of the company-specific risk be diversified away by investing in both Mfs Emerging and Baron Emerging 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 Emerging and Baron Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mfs Emerging Markets and Baron Emerging Markets, you can compare the effects of market volatilities on Mfs Emerging and Baron Emerging 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 Emerging with a short position of Baron Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mfs Emerging and Baron Emerging.
Diversification Opportunities for Mfs Emerging and Baron Emerging
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Mfs and Baron is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Mfs Emerging Markets and Baron Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baron Emerging Markets and Mfs Emerging 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 Emerging Markets are associated (or correlated) with Baron Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baron Emerging Markets has no effect on the direction of Mfs Emerging i.e., Mfs Emerging and Baron Emerging go up and down completely randomly.
Pair Corralation between Mfs Emerging and Baron Emerging
Assuming the 90 days horizon Mfs Emerging Markets is expected to generate 0.32 times more return on investment than Baron Emerging. However, Mfs Emerging Markets is 3.14 times less risky than Baron Emerging. It trades about 0.04 of its potential returns per unit of risk. Baron Emerging Markets is currently generating about -0.1 per unit of risk. If you would invest 1,207 in Mfs Emerging Markets on September 1, 2024 and sell it today you would earn a total of 3.00 from holding Mfs Emerging Markets or generate 0.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mfs Emerging Markets vs. Baron Emerging Markets
Performance |
| Timeline |
| Mfs Emerging Markets |
| Baron Emerging Markets |
Mfs Emerging and Baron Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mfs Emerging and Baron Emerging
The main advantage of trading using opposite Mfs Emerging and Baron Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mfs Emerging position performs unexpectedly, Baron Emerging 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 Baron Emerging will offset losses from the drop in Baron Emerging's long position.| Mfs Emerging vs. Dreyfus Government Cash | Mfs Emerging vs. Ab Government Exchange | Mfs Emerging vs. Dws Government Money | Mfs Emerging vs. Virtus Seix Government |
| Baron Emerging vs. Eaton Vance Income | Baron Emerging vs. Baird Aggregate Bond | Baron Emerging vs. Champlain Small | Baron Emerging vs. Mfs Emerging Markets |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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