Correlation Between Pimco Total and Mfs Value
Can any of the company-specific risk be diversified away by investing in both Pimco Total and Mfs Value 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 Pimco Total and Mfs Value into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pimco Total Return and Mfs Value Fund, you can compare the effects of market volatilities on Pimco Total and Mfs Value 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 Pimco Total with a short position of Mfs Value. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pimco Total and Mfs Value.
Diversification Opportunities for Pimco Total and Mfs Value
-0.49 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Pimco and Mfs is -0.49. Overlapping area represents the amount of risk that can be diversified away by holding Pimco Total Return and Mfs Value Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Value Fund and Pimco Total 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 Pimco Total Return are associated (or correlated) with Mfs Value. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Value Fund has no effect on the direction of Pimco Total i.e., Pimco Total and Mfs Value go up and down completely randomly.
Pair Corralation between Pimco Total and Mfs Value
Assuming the 90 days horizon Pimco Total is expected to generate 5.45 times less return on investment than Mfs Value. But when comparing it to its historical volatility, Pimco Total Return is 1.99 times less risky than Mfs Value. It trades about 0.09 of its potential returns per unit of risk. Mfs Value Fund is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 5,388 in Mfs Value Fund on August 30, 2024 and sell it today you would earn a total of 210.00 from holding Mfs Value Fund or generate 3.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pimco Total Return vs. Mfs Value Fund
Performance |
| Timeline |
| Pimco Total Return |
| Mfs Value Fund |
Pimco Total and Mfs Value Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pimco Total and Mfs Value
The main advantage of trading using opposite Pimco Total and Mfs Value positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pimco Total position performs unexpectedly, Mfs Value 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 Value will offset losses from the drop in Mfs Value's long position.| Pimco Total vs. Lgm Risk Managed | Pimco Total vs. Morningstar Aggressive Growth | Pimco Total vs. Vanguard High Yield Tax Exempt | Pimco Total vs. Ab Global Risk |
| Mfs Value vs. Mfs Prudent Investor | Mfs Value vs. Mfs Prudent Investor | Mfs Value vs. Mfs Prudent Investor | Mfs Value vs. Mfs Prudent Investor |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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