Correlation Between Great West and Mfs Research
Can any of the company-specific risk be diversified away by investing in both Great West and Mfs Research 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 Great West and Mfs Research into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Great West Real Estate and Mfs Research Fund, you can compare the effects of market volatilities on Great West and Mfs Research 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 Great West with a short position of Mfs Research. Check out your portfolio center. Please also check ongoing floating volatility patterns of Great West and Mfs Research.
Diversification Opportunities for Great West and Mfs Research
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Great and Mfs is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Great West Real Estate and Mfs Research Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Research and Great West 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 Great West Real Estate are associated (or correlated) with Mfs Research. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Research has no effect on the direction of Great West i.e., Great West and Mfs Research go up and down completely randomly.
Pair Corralation between Great West and Mfs Research
Assuming the 90 days horizon Great West is expected to generate 1.49 times less return on investment than Mfs Research. In addition to that, Great West is 1.16 times more volatile than Mfs Research Fund. It trades about 0.04 of its total potential returns per unit of risk. Mfs Research Fund is currently generating about 0.07 per unit of volatility. If you would invest 4,317 in Mfs Research Fund on September 13, 2024 and sell it today you would earn a total of 1,678 from holding Mfs Research Fund or generate 38.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Great West Real Estate vs. Mfs Research Fund
Performance |
| Timeline |
| Great West Real |
| Mfs Research |
Great West and Mfs Research Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Great West and Mfs Research
The main advantage of trading using opposite Great West and Mfs Research positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Great West position performs unexpectedly, Mfs Research 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 Research will offset losses from the drop in Mfs Research's long position.| Great West vs. Blackrock Sm Cap | Great West vs. Pimco Diversified Income | Great West vs. Fidelity Advisor Diversified | Great West vs. Tiaa Cref Small Cap Blend |
| Mfs Research vs. T Rowe Price | Mfs Research vs. T Rowe Price | Mfs Research vs. Western Asset Municipal | Mfs Research vs. Ab Global Bond |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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