Correlation Between Netflix and Mfs Lifetime
Can any of the company-specific risk be diversified away by investing in both Netflix and Mfs Lifetime 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 Netflix and Mfs Lifetime into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Netflix and Mfs Lifetime 2040, you can compare the effects of market volatilities on Netflix and Mfs Lifetime 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 Netflix with a short position of Mfs Lifetime. Check out your portfolio center. Please also check ongoing floating volatility patterns of Netflix and Mfs Lifetime.
Diversification Opportunities for Netflix and Mfs Lifetime
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Netflix and Mfs is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Netflix and Mfs Lifetime 2040 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Lifetime 2040 and Netflix 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 Netflix are associated (or correlated) with Mfs Lifetime. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Lifetime 2040 has no effect on the direction of Netflix i.e., Netflix and Mfs Lifetime go up and down completely randomly.
Pair Corralation between Netflix and Mfs Lifetime
Given the investment horizon of 90 days Netflix is expected to generate 3.44 times more return on investment than Mfs Lifetime. However, Netflix is 3.44 times more volatile than Mfs Lifetime 2040. It trades about 0.11 of its potential returns per unit of risk. Mfs Lifetime 2040 is currently generating about 0.09 per unit of risk. If you would invest 31,783 in Netflix on September 4, 2024 and sell it today you would earn a total of 57,991 from holding Netflix or generate 182.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Netflix vs. Mfs Lifetime 2040
Performance |
| Timeline |
| Netflix |
| Mfs Lifetime 2040 |
Netflix and Mfs Lifetime Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Netflix and Mfs Lifetime
The main advantage of trading using opposite Netflix and Mfs Lifetime positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Netflix position performs unexpectedly, Mfs Lifetime 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 Lifetime will offset losses from the drop in Mfs Lifetime's long position.| Netflix vs. Paramount Global Class | Netflix vs. Roku Inc | Netflix vs. Warner Bros Discovery | Netflix vs. AMC Entertainment Holdings |
| Mfs Lifetime vs. Artisan High Income | Mfs Lifetime vs. Prudential High Yield | Mfs Lifetime vs. T Rowe Price | Mfs Lifetime vs. Pioneer High Yield |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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