Correlation Between Nuveen New and MFS High
Can any of the company-specific risk be diversified away by investing in both Nuveen New 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 Nuveen New and MFS High into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nuveen New York and MFS High Income, you can compare the effects of market volatilities on Nuveen New 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 Nuveen New with a short position of MFS High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nuveen New and MFS High.
Diversification Opportunities for Nuveen New and MFS High
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Nuveen and MFS is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Nuveen New York 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 Nuveen New 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 Nuveen New York 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 Nuveen New i.e., Nuveen New and MFS High go up and down completely randomly.
Pair Corralation between Nuveen New and MFS High
Considering the 90-day investment horizon Nuveen New is expected to generate 1.99 times less return on investment than MFS High. But when comparing it to its historical volatility, Nuveen New York is 1.82 times less risky than MFS High. It trades about 0.11 of its potential returns per unit of risk. MFS High Income is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 345.00 in MFS High Income on August 28, 2024 and sell it today you would earn a total of 35.00 from holding MFS High Income or generate 10.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nuveen New York vs. MFS High Income
Performance |
| Timeline |
| Nuveen New York |
| MFS High Income |
Nuveen New and MFS High Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nuveen New and MFS High
The main advantage of trading using opposite Nuveen New and MFS High positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nuveen New 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.| Nuveen New vs. Nuveen Municipalome | Nuveen New vs. Northern Trust | Nuveen New vs. Liberty All Star | Nuveen New vs. Goldman Sachs BDC |
| 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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