Correlation Between Templeton Emerging and MFS Special
Can any of the company-specific risk be diversified away by investing in both Templeton Emerging and MFS Special 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 Templeton Emerging and MFS Special into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Templeton Emerging Markets and MFS Special Value, you can compare the effects of market volatilities on Templeton Emerging and MFS Special 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 Templeton Emerging with a short position of MFS Special. Check out your portfolio center. Please also check ongoing floating volatility patterns of Templeton Emerging and MFS Special.
Diversification Opportunities for Templeton Emerging and MFS Special
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Templeton and MFS is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Templeton Emerging Markets and MFS Special Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MFS Special Value and Templeton Emerging 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 Templeton Emerging Markets are associated (or correlated) with MFS Special. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MFS Special Value has no effect on the direction of Templeton Emerging i.e., Templeton Emerging and MFS Special go up and down completely randomly.
Pair Corralation between Templeton Emerging and MFS Special
Considering the 90-day investment horizon Templeton Emerging Markets is expected to generate 1.19 times more return on investment than MFS Special. However, Templeton Emerging is 1.19 times more volatile than MFS Special Value. It trades about 0.05 of its potential returns per unit of risk. MFS Special Value is currently generating about 0.01 per unit of risk. If you would invest 403.00 in Templeton Emerging Markets on August 28, 2024 and sell it today you would earn a total of 136.00 from holding Templeton Emerging Markets or generate 33.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 31.72% |
| Values | Daily Returns |
Templeton Emerging Markets vs. MFS Special Value
Performance |
| Timeline |
| Templeton Emerging |
| MFS Special Value |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Templeton Emerging and MFS Special Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Templeton Emerging and MFS Special
The main advantage of trading using opposite Templeton Emerging and MFS Special positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Templeton Emerging position performs unexpectedly, MFS Special 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 Special will offset losses from the drop in MFS Special's long position.| Templeton Emerging vs. Franklin Templeton Limited | Templeton Emerging vs. Western Asset Global | Templeton Emerging vs. MFS Multimarket Income | Templeton Emerging vs. Aberdeen Asia Pacific If |
| MFS Special vs. Brookfield Business Corp | MFS Special vs. Elysee Development Corp | MFS Special vs. DWS Municipal Income | MFS Special vs. Blackrock Munivest |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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