Correlation Between Touchstone Large and Mfs Aggressive
Can any of the company-specific risk be diversified away by investing in both Touchstone Large and Mfs Aggressive 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 Touchstone Large and Mfs Aggressive into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Touchstone Large Cap and Mfs Aggressive Growth, you can compare the effects of market volatilities on Touchstone Large and Mfs Aggressive 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 Touchstone Large with a short position of Mfs Aggressive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Touchstone Large and Mfs Aggressive.
Diversification Opportunities for Touchstone Large and Mfs Aggressive
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Touchstone and Mfs is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Touchstone Large Cap and Mfs Aggressive Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Aggressive Growth and Touchstone Large 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 Touchstone Large Cap are associated (or correlated) with Mfs Aggressive. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Aggressive Growth has no effect on the direction of Touchstone Large i.e., Touchstone Large and Mfs Aggressive go up and down completely randomly.
Pair Corralation between Touchstone Large and Mfs Aggressive
Assuming the 90 days horizon Touchstone Large Cap is expected to under-perform the Mfs Aggressive. In addition to that, Touchstone Large is 1.02 times more volatile than Mfs Aggressive Growth. It trades about -0.09 of its total potential returns per unit of risk. Mfs Aggressive Growth is currently generating about 0.02 per unit of volatility. If you would invest 3,051 in Mfs Aggressive Growth on September 12, 2024 and sell it today you would earn a total of 7.00 from holding Mfs Aggressive Growth or generate 0.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Touchstone Large Cap vs. Mfs Aggressive Growth
Performance |
| Timeline |
| Touchstone Large Cap |
| Mfs Aggressive Growth |
Touchstone Large and Mfs Aggressive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Touchstone Large and Mfs Aggressive
The main advantage of trading using opposite Touchstone Large and Mfs Aggressive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Touchstone Large position performs unexpectedly, Mfs Aggressive 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 Aggressive will offset losses from the drop in Mfs Aggressive's long position.| Touchstone Large vs. Jhancock Disciplined Value | Touchstone Large vs. Fidelity Series 1000 | Touchstone Large vs. Dana Large Cap | Touchstone Large vs. Americafirst Large Cap |
| Mfs Aggressive vs. Absolute Convertible Arbitrage | Mfs Aggressive vs. Calamos Dynamic Convertible | Mfs Aggressive vs. Rationalpier 88 Convertible | Mfs Aggressive vs. Virtus Convertible |
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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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