Correlation Between Touchstone Premium and Mfs Aggressive
Can any of the company-specific risk be diversified away by investing in both Touchstone Premium 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 Premium 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 Premium Yield and Mfs Aggressive Growth, you can compare the effects of market volatilities on Touchstone Premium 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 Premium with a short position of Mfs Aggressive. Check out your portfolio center. Please also check ongoing floating volatility patterns of Touchstone Premium and Mfs Aggressive.
Diversification Opportunities for Touchstone Premium and Mfs Aggressive
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Touchstone and Mfs is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Touchstone Premium Yield 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 Premium 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 Premium Yield 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 Premium i.e., Touchstone Premium and Mfs Aggressive go up and down completely randomly.
Pair Corralation between Touchstone Premium and Mfs Aggressive
Assuming the 90 days horizon Touchstone Premium Yield is expected to under-perform the Mfs Aggressive. In addition to that, Touchstone Premium is 1.7 times more volatile than Mfs Aggressive Growth. It trades about -0.01 of its total potential returns per unit of risk. Mfs Aggressive Growth is currently generating about 0.0 per unit of volatility. If you would invest 3,018 in Mfs Aggressive Growth on December 4, 2024 and sell it today you would lose (20.00) from holding Mfs Aggressive Growth or give up 0.66% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.19% |
| Values | Daily Returns |
Touchstone Premium Yield vs. Mfs Aggressive Growth
Performance |
| Timeline |
| Touchstone Premium Yield |
| Mfs Aggressive Growth |
Touchstone Premium and Mfs Aggressive Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Touchstone Premium and Mfs Aggressive
The main advantage of trading using opposite Touchstone Premium and Mfs Aggressive positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Touchstone Premium 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 Premium vs. Ashmore Emerging Markets | Touchstone Premium vs. United Kingdom Small | Touchstone Premium vs. Franklin Small Cap | Touchstone Premium vs. Ab Small Cap |
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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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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