Correlation Between Mfs Series and Mfs Diversified
Can any of the company-specific risk be diversified away by investing in both Mfs Series and Mfs Diversified 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 Series and Mfs Diversified into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mfs Series Trust and Mfs Diversified Income, you can compare the effects of market volatilities on Mfs Series and Mfs Diversified 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 Series with a short position of Mfs Diversified. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mfs Series and Mfs Diversified.
Diversification Opportunities for Mfs Series and Mfs Diversified
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Mfs and Mfs is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Mfs Series Trust and Mfs Diversified Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Diversified Income and Mfs Series 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 Series Trust are associated (or correlated) with Mfs Diversified. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Diversified Income has no effect on the direction of Mfs Series i.e., Mfs Series and Mfs Diversified go up and down completely randomly.
Pair Corralation between Mfs Series and Mfs Diversified
Assuming the 90 days horizon Mfs Series Trust is expected to generate 2.14 times more return on investment than Mfs Diversified. However, Mfs Series is 2.14 times more volatile than Mfs Diversified Income. It trades about 0.33 of its potential returns per unit of risk. Mfs Diversified Income is currently generating about 0.11 per unit of risk. If you would invest 1,301 in Mfs Series Trust on November 3, 2024 and sell it today you would earn a total of 74.00 from holding Mfs Series Trust or generate 5.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mfs Series Trust vs. Mfs Diversified Income
Performance |
| Timeline |
| Mfs Series Trust |
| Mfs Diversified Income |
Mfs Series and Mfs Diversified Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mfs Series and Mfs Diversified
The main advantage of trading using opposite Mfs Series and Mfs Diversified positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mfs Series position performs unexpectedly, Mfs Diversified 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 Diversified will offset losses from the drop in Mfs Diversified's long position.| Mfs Series vs. Great West Loomis Sayles | Mfs Series vs. Heartland Value Plus | Mfs Series vs. Applied Finance Explorer | Mfs Series vs. Mutual Of America |
| Mfs Diversified vs. Vanguard Money Market | Mfs Diversified vs. Financial Industries Fund | Mfs Diversified vs. Franklin Government Money | Mfs Diversified vs. Angel Oak Financial |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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