Correlation Between Virtus AllianzGI and MFS High
Can any of the company-specific risk be diversified away by investing in both Virtus AllianzGI and MFS High 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 Virtus AllianzGI and MFS High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Virtus AllianzGI Convertible and MFS High Income, you can compare the effects of market volatilities on Virtus AllianzGI and MFS High 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 Virtus AllianzGI with a short position of MFS High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Virtus AllianzGI and MFS High.
Diversification Opportunities for Virtus AllianzGI and MFS High
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Virtus and MFS is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Virtus AllianzGI Convertible and MFS High Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MFS High Income and Virtus AllianzGI 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 Virtus AllianzGI Convertible are associated (or correlated) with MFS High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MFS High Income has no effect on the direction of Virtus AllianzGI i.e., Virtus AllianzGI and MFS High go up and down completely randomly.
Pair Corralation between Virtus AllianzGI and MFS High
Assuming the 90 days trading horizon Virtus AllianzGI Convertible is expected to under-perform the MFS High. In addition to that, Virtus AllianzGI is 1.26 times more volatile than MFS High Income. It trades about -0.09 of its total potential returns per unit of risk. MFS High Income is currently generating about 0.12 per unit of volatility. If you would invest 382.00 in MFS High Income on September 1, 2024 and sell it today you would earn a total of 6.00 from holding MFS High Income or generate 1.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Virtus AllianzGI Convertible vs. MFS High Income
Performance |
| Timeline |
| Virtus AllianzGI Con |
| MFS High Income |
Virtus AllianzGI and MFS High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Virtus AllianzGI and MFS High
The main advantage of trading using opposite Virtus AllianzGI and MFS High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Virtus AllianzGI position performs unexpectedly, MFS High 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 High will offset losses from the drop in MFS High's long position.| Virtus AllianzGI vs. The Gabelli Equity | Virtus AllianzGI vs. The Gabelli Equity | Virtus AllianzGI vs. Oxford Lane Capital | Virtus AllianzGI vs. The Gabelli Utility |
| MFS High vs. MFS Investment Grade | MFS High vs. Eaton Vance National | MFS High vs. Invesco High Income | MFS High vs. Blackrock Muniholdings Ny |
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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