Correlation Between MFS Intermediate and Blackrock Muniholdings
Can any of the company-specific risk be diversified away by investing in both MFS Intermediate and Blackrock Muniholdings 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 Intermediate and Blackrock Muniholdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MFS Intermediate Income and Blackrock Muniholdings Quality, you can compare the effects of market volatilities on MFS Intermediate and Blackrock Muniholdings 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 Intermediate with a short position of Blackrock Muniholdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFS Intermediate and Blackrock Muniholdings.
Diversification Opportunities for MFS Intermediate and Blackrock Muniholdings
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between MFS and Blackrock is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding MFS Intermediate Income and Blackrock Muniholdings Quality in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackrock Muniholdings and MFS Intermediate 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 Intermediate Income are associated (or correlated) with Blackrock Muniholdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackrock Muniholdings has no effect on the direction of MFS Intermediate i.e., MFS Intermediate and Blackrock Muniholdings go up and down completely randomly.
Pair Corralation between MFS Intermediate and Blackrock Muniholdings
Considering the 90-day investment horizon MFS Intermediate is expected to generate 1.9 times less return on investment than Blackrock Muniholdings. But when comparing it to its historical volatility, MFS Intermediate Income is 1.08 times less risky than Blackrock Muniholdings. It trades about 0.03 of its potential returns per unit of risk. Blackrock Muniholdings Quality is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,010 in Blackrock Muniholdings Quality on October 20, 2024 and sell it today you would earn a total of 8.00 from holding Blackrock Muniholdings Quality or generate 0.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
MFS Intermediate Income vs. Blackrock Muniholdings Quality
Performance |
| Timeline |
| MFS Intermediate Income |
| Blackrock Muniholdings |
MFS Intermediate and Blackrock Muniholdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MFS Intermediate and Blackrock Muniholdings
The main advantage of trading using opposite MFS Intermediate and Blackrock Muniholdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MFS Intermediate position performs unexpectedly, Blackrock Muniholdings 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 Blackrock Muniholdings will offset losses from the drop in Blackrock Muniholdings' long position.| MFS Intermediate vs. MFS Government Markets | MFS Intermediate vs. MFS Multimarket Income | MFS Intermediate vs. MFS Charter Income | MFS Intermediate vs. Putnam Premier Income |
| Blackrock Muniholdings vs. John Hancock Income | Blackrock Muniholdings vs. MFS High Income | Blackrock Muniholdings vs. MFS Investment Grade | Blackrock Muniholdings vs. Blackrock Muniholdings Closed |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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