Correlation Between Mfs Technology and Ftfa Franklin
Can any of the company-specific risk be diversified away by investing in both Mfs Technology and Ftfa Franklin 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 Technology and Ftfa Franklin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mfs Technology Fund and Ftfa Franklin Templeton Growth, you can compare the effects of market volatilities on Mfs Technology and Ftfa Franklin 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 Technology with a short position of Ftfa Franklin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mfs Technology and Ftfa Franklin.
Diversification Opportunities for Mfs Technology and Ftfa Franklin
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Mfs and Ftfa is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Mfs Technology Fund and Ftfa Franklin Templeton Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ftfa Franklin Templeton and Mfs Technology 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 Technology Fund are associated (or correlated) with Ftfa Franklin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ftfa Franklin Templeton has no effect on the direction of Mfs Technology i.e., Mfs Technology and Ftfa Franklin go up and down completely randomly.
Pair Corralation between Mfs Technology and Ftfa Franklin
Assuming the 90 days horizon Mfs Technology Fund is expected to under-perform the Ftfa Franklin. In addition to that, Mfs Technology is 6.73 times more volatile than Ftfa Franklin Templeton Growth. It trades about -0.17 of its total potential returns per unit of risk. Ftfa Franklin Templeton Growth is currently generating about -0.08 per unit of volatility. If you would invest 2,083 in Ftfa Franklin Templeton Growth on September 20, 2024 and sell it today you would lose (23.00) from holding Ftfa Franklin Templeton Growth or give up 1.1% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mfs Technology Fund vs. Ftfa Franklin Templeton Growth
Performance |
| Timeline |
| Mfs Technology |
| Ftfa Franklin Templeton |
Mfs Technology and Ftfa Franklin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mfs Technology and Ftfa Franklin
The main advantage of trading using opposite Mfs Technology and Ftfa Franklin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mfs Technology position performs unexpectedly, Ftfa Franklin 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 Ftfa Franklin will offset losses from the drop in Ftfa Franklin's long position.| Mfs Technology vs. Nasdaq 100 Index Fund | Mfs Technology vs. Predex Funds | Mfs Technology vs. Gmo Treasury Fund | Mfs Technology vs. Eic Value Fund |
| Ftfa Franklin vs. Mfs Technology Fund | Ftfa Franklin vs. Pgim Jennison Technology | Ftfa Franklin vs. Janus Global Technology | Ftfa Franklin vs. Red Oak Technology |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges |