Correlation Between Mfs Variable and Sterling Capital
Can any of the company-specific risk be diversified away by investing in both Mfs Variable and Sterling Capital 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 Mfs Variable and Sterling Capital into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mfs Variable Insurance and Sterling Capital Stratton, you can compare the effects of market volatilities on Mfs Variable and Sterling Capital 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 Mfs Variable with a short position of Sterling Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mfs Variable and Sterling Capital.
Diversification Opportunities for Mfs Variable and Sterling Capital
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Mfs and Sterling is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Mfs Variable Insurance and Sterling Capital Stratton in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sterling Capital Stratton and Mfs Variable 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 Mfs Variable Insurance are associated (or correlated) with Sterling Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sterling Capital Stratton has no effect on the direction of Mfs Variable i.e., Mfs Variable and Sterling Capital go up and down completely randomly.
Pair Corralation between Mfs Variable and Sterling Capital
Assuming the 90 days horizon Mfs Variable Insurance is expected to generate 0.58 times more return on investment than Sterling Capital. However, Mfs Variable Insurance is 1.73 times less risky than Sterling Capital. It trades about 0.01 of its potential returns per unit of risk. Sterling Capital Stratton is currently generating about -0.03 per unit of risk. If you would invest 3,581 in Mfs Variable Insurance on November 5, 2024 and sell it today you would lose (8.00) from holding Mfs Variable Insurance or give up 0.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mfs Variable Insurance vs. Sterling Capital Stratton
Performance |
| Timeline |
| Mfs Variable Insurance |
| Sterling Capital Stratton |
Mfs Variable and Sterling Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mfs Variable and Sterling Capital
The main advantage of trading using opposite Mfs Variable and Sterling Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mfs Variable position performs unexpectedly, Sterling Capital 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 Sterling Capital will offset losses from the drop in Sterling Capital's long position.| Mfs Variable vs. Old Westbury California | Mfs Variable vs. Morningstar Defensive Bond | Mfs Variable vs. Rbc Bluebay Emerging | Mfs Variable vs. Multisector Bond Sma |
| Sterling Capital vs. Dreyfus Government Cash | Sterling Capital vs. Elfun Government Money | Sterling Capital vs. Schwab Government Money | Sterling Capital vs. Lord Abbett Government |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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