Correlation Between Macquariefirst and MFS Investment
Can any of the company-specific risk be diversified away by investing in both Macquariefirst and MFS Investment 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 Macquariefirst and MFS Investment into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Macquariefirst Tr Global and MFS Investment Grade, you can compare the effects of market volatilities on Macquariefirst and MFS Investment 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 Macquariefirst with a short position of MFS Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Macquariefirst and MFS Investment.
Diversification Opportunities for Macquariefirst and MFS Investment
0.05 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Macquariefirst and MFS is 0.05. Overlapping area represents the amount of risk that can be diversified away by holding Macquariefirst Tr Global and MFS Investment Grade in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MFS Investment Grade and Macquariefirst 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 Macquariefirst Tr Global are associated (or correlated) with MFS Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MFS Investment Grade has no effect on the direction of Macquariefirst i.e., Macquariefirst and MFS Investment go up and down completely randomly.
Pair Corralation between Macquariefirst and MFS Investment
Considering the 90-day investment horizon Macquariefirst Tr Global is expected to generate 1.51 times more return on investment than MFS Investment. However, Macquariefirst is 1.51 times more volatile than MFS Investment Grade. It trades about 0.07 of its potential returns per unit of risk. MFS Investment Grade is currently generating about 0.08 per unit of risk. If you would invest 693.00 in Macquariefirst Tr Global on September 4, 2024 and sell it today you would earn a total of 152.00 from holding Macquariefirst Tr Global or generate 21.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 86.6% |
| Values | Daily Returns |
Macquariefirst Tr Global vs. MFS Investment Grade
Performance |
| Timeline |
| Macquariefirst Tr Global |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| MFS Investment Grade |
Macquariefirst and MFS Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Macquariefirst and MFS Investment
The main advantage of trading using opposite Macquariefirst and MFS Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Macquariefirst position performs unexpectedly, MFS Investment 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 Investment will offset losses from the drop in MFS Investment's long position.| Macquariefirst vs. MFS High Yield | Macquariefirst vs. MFS Investment Grade | Macquariefirst vs. MFS Municipal Income | Macquariefirst vs. DTF Tax Free |
| MFS Investment vs. Invesco High Income | MFS Investment vs. Eaton Vance National | MFS Investment vs. Nuveen California Select | MFS Investment vs. Federated Premier Municipal |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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