Correlation Between Mfs Value and Oklahoma Municipal
Can any of the company-specific risk be diversified away by investing in both Mfs Value and Oklahoma Municipal 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 Value and Oklahoma Municipal into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mfs Value Fund and Oklahoma Municipal Fund, you can compare the effects of market volatilities on Mfs Value and Oklahoma Municipal 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 Value with a short position of Oklahoma Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mfs Value and Oklahoma Municipal.
Diversification Opportunities for Mfs Value and Oklahoma Municipal
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Mfs and Oklahoma is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Mfs Value Fund and Oklahoma Municipal Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oklahoma Municipal and Mfs Value 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 Value Fund are associated (or correlated) with Oklahoma Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oklahoma Municipal has no effect on the direction of Mfs Value i.e., Mfs Value and Oklahoma Municipal go up and down completely randomly.
Pair Corralation between Mfs Value and Oklahoma Municipal
Assuming the 90 days horizon Mfs Value Fund is expected to under-perform the Oklahoma Municipal. In addition to that, Mfs Value is 2.35 times more volatile than Oklahoma Municipal Fund. It trades about -0.04 of its total potential returns per unit of risk. Oklahoma Municipal Fund is currently generating about 0.12 per unit of volatility. If you would invest 1,045 in Oklahoma Municipal Fund on November 27, 2024 and sell it today you would earn a total of 6.00 from holding Oklahoma Municipal Fund or generate 0.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mfs Value Fund vs. Oklahoma Municipal Fund
Performance |
| Timeline |
| Mfs Value Fund |
| Oklahoma Municipal |
Mfs Value and Oklahoma Municipal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mfs Value and Oklahoma Municipal
The main advantage of trading using opposite Mfs Value and Oklahoma Municipal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mfs Value position performs unexpectedly, Oklahoma Municipal 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 Oklahoma Municipal will offset losses from the drop in Oklahoma Municipal's long position.| Mfs Value vs. Ab Municipal Bond | Mfs Value vs. Inverse Government Long | Mfs Value vs. Bbh Intermediate Municipal | Mfs Value vs. Us Government Securities |
| Oklahoma Municipal vs. Rbc Short Duration | Oklahoma Municipal vs. Calvert Short Duration | Oklahoma Municipal vs. Transam Short Term Bond | Oklahoma Municipal vs. Ashmore 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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