Correlation Between Mfs Blended and Emerging Markets
Can any of the company-specific risk be diversified away by investing in both Mfs Blended and Emerging Markets 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 Blended and Emerging Markets into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mfs Blended Research and Emerging Markets Value, you can compare the effects of market volatilities on Mfs Blended and Emerging Markets 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 Blended with a short position of Emerging Markets. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mfs Blended and Emerging Markets.
Diversification Opportunities for Mfs Blended and Emerging Markets
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Mfs and Emerging is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Mfs Blended Research and Emerging Markets Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Emerging Markets Value and Mfs Blended 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 Blended Research are associated (or correlated) with Emerging Markets. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Emerging Markets Value has no effect on the direction of Mfs Blended i.e., Mfs Blended and Emerging Markets go up and down completely randomly.
Pair Corralation between Mfs Blended and Emerging Markets
Assuming the 90 days horizon Mfs Blended is expected to generate 1.93 times less return on investment than Emerging Markets. In addition to that, Mfs Blended is 1.15 times more volatile than Emerging Markets Value. It trades about 0.01 of its total potential returns per unit of risk. Emerging Markets Value is currently generating about 0.03 per unit of volatility. If you would invest 2,686 in Emerging Markets Value on January 25, 2024 and sell it today you would earn a total of 315.00 from holding Emerging Markets Value or generate 11.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mfs Blended Research vs. Emerging Markets Value
Performance |
| Timeline |
| Mfs Blended Research |
| Emerging Markets Value |
Mfs Blended and Emerging Markets Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mfs Blended and Emerging Markets
The main advantage of trading using opposite Mfs Blended and Emerging Markets positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mfs Blended position performs unexpectedly, Emerging Markets 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 Emerging Markets will offset losses from the drop in Emerging Markets' long position.| Mfs Blended vs. Mfs Prudent Investor | Mfs Blended vs. Mfs Prudent Investor | Mfs Blended vs. Mfs Prudent Investor | Mfs Blended vs. Mfs Prudent Investor |
| Emerging Markets vs. Dfa International Small | Emerging Markets vs. International Small Pany | Emerging Markets vs. Emerging Markets Small | Emerging Markets vs. Dfa International Value |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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