Correlation Between Sterling Capital and Mfs Blended
Can any of the company-specific risk be diversified away by investing in both Sterling Capital and Mfs Blended 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 Sterling Capital and Mfs Blended into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sterling Capital Smid and Mfs Blended Research, you can compare the effects of market volatilities on Sterling Capital and Mfs Blended 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 Sterling Capital with a short position of Mfs Blended. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sterling Capital and Mfs Blended.
Diversification Opportunities for Sterling Capital and Mfs Blended
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Sterling and Mfs is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Sterling Capital Smid and Mfs Blended Research in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Blended Research and Sterling Capital 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 Sterling Capital Smid are associated (or correlated) with Mfs Blended. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Blended Research has no effect on the direction of Sterling Capital i.e., Sterling Capital and Mfs Blended go up and down completely randomly.
Pair Corralation between Sterling Capital and Mfs Blended
Assuming the 90 days horizon Sterling Capital Smid is expected to under-perform the Mfs Blended. In addition to that, Sterling Capital is 2.14 times more volatile than Mfs Blended Research. It trades about -0.06 of its total potential returns per unit of risk. Mfs Blended Research is currently generating about 0.09 per unit of volatility. If you would invest 1,140 in Mfs Blended Research on January 19, 2024 and sell it today you would earn a total of 246.00 from holding Mfs Blended Research or generate 21.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 77.51% |
| Values | Daily Returns |
Sterling Capital Smid vs. Mfs Blended Research
Performance |
| Timeline |
| Sterling Capital Smid |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Excellent
| Mfs Blended Research |
Sterling Capital and Mfs Blended Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sterling Capital and Mfs Blended
The main advantage of trading using opposite Sterling Capital and Mfs Blended positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sterling Capital position performs unexpectedly, Mfs Blended 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 Blended will offset losses from the drop in Mfs Blended's long position.| Sterling Capital vs. Hennessy Bp Energy | Sterling Capital vs. Gmo Resources | Sterling Capital vs. Franklin Natural Resources | Sterling Capital vs. Energy Basic Materials |
| Mfs Blended vs. Aamphocas Real Estate | Mfs Blended vs. Global Real Estate | Mfs Blended vs. Forum Real Estate | Mfs Blended vs. Pender Real Estate |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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