Correlation Between MFS Municipal and Eaton Vance
Can any of the company-specific risk be diversified away by investing in both MFS Municipal and Eaton Vance 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 Municipal and Eaton Vance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MFS Municipal Income and Eaton Vance Tax, you can compare the effects of market volatilities on MFS Municipal and Eaton Vance 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 Municipal with a short position of Eaton Vance. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFS Municipal and Eaton Vance.
Diversification Opportunities for MFS Municipal and Eaton Vance
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MFS and Eaton is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding MFS Municipal Income and Eaton Vance Tax in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eaton Vance Tax and MFS Municipal 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 Municipal Income are associated (or correlated) with Eaton Vance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eaton Vance Tax has no effect on the direction of MFS Municipal i.e., MFS Municipal and Eaton Vance go up and down completely randomly.
Pair Corralation between MFS Municipal and Eaton Vance
Considering the 90-day investment horizon MFS Municipal is expected to generate 1.25 times less return on investment than Eaton Vance. In addition to that, MFS Municipal is 1.38 times more volatile than Eaton Vance Tax. It trades about 0.23 of its total potential returns per unit of risk. Eaton Vance Tax is currently generating about 0.39 per unit of volatility. If you would invest 1,430 in Eaton Vance Tax on August 30, 2024 and sell it today you would earn a total of 63.00 from holding Eaton Vance Tax or generate 4.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
MFS Municipal Income vs. Eaton Vance Tax
Performance |
| Timeline |
| MFS Municipal Income |
| Eaton Vance Tax |
MFS Municipal and Eaton Vance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MFS Municipal and Eaton Vance
The main advantage of trading using opposite MFS Municipal and Eaton Vance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MFS Municipal position performs unexpectedly, Eaton Vance 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 Eaton Vance will offset losses from the drop in Eaton Vance's long position.| MFS Municipal vs. Eaton Vance National | MFS Municipal vs. Invesco High Income | MFS Municipal vs. Blackrock Muniholdings Ny | MFS Municipal vs. Nuveen California Select |
| Eaton Vance vs. Eaton Vance Tax | Eaton Vance vs. Eaton Vance Tax Managed | Eaton Vance vs. Eaton Vance Risk | Eaton Vance vs. Eaton Vance Tax |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
Other Complementary Tools
| CEOs Directory Screen CEOs from public companies around the world | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities |