Correlation Between Mfs Total and Mfs Union
Can any of the company-specific risk be diversified away by investing in both Mfs Total and Mfs Union 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 Total and Mfs Union into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mfs Total Return and Mfs Union Standard, you can compare the effects of market volatilities on Mfs Total and Mfs Union 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 Total with a short position of Mfs Union. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mfs Total and Mfs Union.
Diversification Opportunities for Mfs Total and Mfs Union
Poor diversification
The 3 months correlation between Mfs and Mfs is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Mfs Total Return and Mfs Union Standard in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Union Standard and Mfs Total 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 Total Return are associated (or correlated) with Mfs Union. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Union Standard has no effect on the direction of Mfs Total i.e., Mfs Total and Mfs Union go up and down completely randomly.
Pair Corralation between Mfs Total and Mfs Union
Assuming the 90 days horizon Mfs Total is expected to generate 7.4 times less return on investment than Mfs Union. But when comparing it to its historical volatility, Mfs Total Return is 2.95 times less risky than Mfs Union. It trades about 0.03 of its potential returns per unit of risk. Mfs Union Standard is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 3,144 in Mfs Union Standard on October 26, 2024 and sell it today you would earn a total of 629.00 from holding Mfs Union Standard or generate 20.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.63% |
| Values | Daily Returns |
Mfs Total Return vs. Mfs Union Standard
Performance |
| Timeline |
| Mfs Total Return |
| Mfs Union Standard |
Mfs Total and Mfs Union Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mfs Total and Mfs Union
The main advantage of trading using opposite Mfs Total and Mfs Union positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mfs Total position performs unexpectedly, Mfs Union 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 Union will offset losses from the drop in Mfs Union's long position.| Mfs Total vs. Enhanced Large Pany | Mfs Total vs. Principal Lifetime Hybrid | Mfs Total vs. T Rowe Price | Mfs Total vs. Fisher Large Cap |
| Mfs Union vs. Oil Gas Ultrasector | Mfs Union vs. Fidelity Advisor Energy | Mfs Union vs. Clearbridge Energy Mlp | Mfs Union vs. Vanguard Energy Index |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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