Correlation Between Mfs Growth and Mfs Mid
Can any of the company-specific risk be diversified away by investing in both Mfs Growth and Mfs Mid 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 Growth and Mfs Mid into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mfs Growth Fund and Mfs Mid Cap, you can compare the effects of market volatilities on Mfs Growth and Mfs Mid 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 Growth with a short position of Mfs Mid. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mfs Growth and Mfs Mid.
Diversification Opportunities for Mfs Growth and Mfs Mid
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Mfs and Mfs is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Mfs Growth Fund and Mfs Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Mid Cap and Mfs Growth 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 Growth Fund are associated (or correlated) with Mfs Mid. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Mid Cap has no effect on the direction of Mfs Growth i.e., Mfs Growth and Mfs Mid go up and down completely randomly.
Pair Corralation between Mfs Growth and Mfs Mid
Assuming the 90 days horizon Mfs Growth is expected to generate 2.33 times less return on investment than Mfs Mid. In addition to that, Mfs Growth is 1.01 times more volatile than Mfs Mid Cap. It trades about 0.14 of its total potential returns per unit of risk. Mfs Mid Cap is currently generating about 0.32 per unit of volatility. If you would invest 2,996 in Mfs Mid Cap on August 25, 2024 and sell it today you would earn a total of 238.00 from holding Mfs Mid Cap or generate 7.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mfs Growth Fund vs. Mfs Mid Cap
Performance |
| Timeline |
| Mfs Growth Fund |
| Mfs Mid Cap |
Mfs Growth and Mfs Mid Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mfs Growth and Mfs Mid
The main advantage of trading using opposite Mfs Growth and Mfs Mid positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mfs Growth position performs unexpectedly, Mfs Mid 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 Mid will offset losses from the drop in Mfs Mid's long position.| Mfs Growth vs. Mfs Value Fund | Mfs Growth vs. Mfs International Value | Mfs Growth vs. Mfs International Diversification | Mfs Growth vs. John Hancock Disciplined |
| Mfs Mid vs. Mfs International Diversification | Mfs Mid vs. Franklin Dynatech Fund | Mfs Mid vs. Mfs Mid Cap | Mfs Mid vs. Mfs Growth Fund |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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