Correlation Between Arrow Managed and Mfs Variable
Can any of the company-specific risk be diversified away by investing in both Arrow Managed and Mfs Variable 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 Arrow Managed and Mfs Variable into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Arrow Managed Futures and Mfs Variable Insurance, you can compare the effects of market volatilities on Arrow Managed and Mfs Variable 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 Arrow Managed with a short position of Mfs Variable. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arrow Managed and Mfs Variable.
Diversification Opportunities for Arrow Managed and Mfs Variable
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Arrow and Mfs is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Arrow Managed Futures and Mfs Variable Insurance in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Variable Insurance and Arrow Managed 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 Arrow Managed Futures are associated (or correlated) with Mfs Variable. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Variable Insurance has no effect on the direction of Arrow Managed i.e., Arrow Managed and Mfs Variable go up and down completely randomly.
Pair Corralation between Arrow Managed and Mfs Variable
Assuming the 90 days horizon Arrow Managed Futures is expected to generate 1.09 times more return on investment than Mfs Variable. However, Arrow Managed is 1.09 times more volatile than Mfs Variable Insurance. It trades about 0.23 of its potential returns per unit of risk. Mfs Variable Insurance is currently generating about 0.06 per unit of risk. If you would invest 561.00 in Arrow Managed Futures on November 3, 2024 and sell it today you would earn a total of 36.00 from holding Arrow Managed Futures or generate 6.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Arrow Managed Futures vs. Mfs Variable Insurance
Performance |
| Timeline |
| Arrow Managed Futures |
| Mfs Variable Insurance |
Arrow Managed and Mfs Variable Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Arrow Managed and Mfs Variable
The main advantage of trading using opposite Arrow Managed and Mfs Variable positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arrow Managed position performs unexpectedly, Mfs Variable 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 Variable will offset losses from the drop in Mfs Variable's long position.| Arrow Managed vs. Glg Intl Small | Arrow Managed vs. Intal High Relative | Arrow Managed vs. Ab Small Cap | Arrow Managed vs. Rbb Fund |
| Mfs Variable vs. Columbia Convertible Securities | Mfs Variable vs. Virtus Convertible | Mfs Variable vs. Putnam Convertible Securities | Mfs Variable vs. Advent Claymore Convertible |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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