Correlation Between Mfs Emerging and Ms Global

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Can any of the company-specific risk be diversified away by investing in both Mfs Emerging and Ms Global 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 Emerging and Ms Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mfs Emerging Markets and Ms Global Fixed, you can compare the effects of market volatilities on Mfs Emerging and Ms Global 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 Emerging with a short position of Ms Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mfs Emerging and Ms Global.

Diversification Opportunities for Mfs Emerging and Ms Global

MfsMFIRXDiversified AwayMfsMFIRXDiversified Away100%
0.29
  Correlation Coefficient

Modest diversification

The 3 months correlation between Mfs and MFIRX is 0.29. Overlapping area represents the amount of risk that can be diversified away by holding Mfs Emerging Markets and Ms Global Fixed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ms Global Fixed and Mfs 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 Mfs Emerging Markets are associated (or correlated) with Ms Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ms Global Fixed has no effect on the direction of Mfs Emerging i.e., Mfs Emerging and Ms Global go up and down completely randomly.

Pair Corralation between Mfs Emerging and Ms Global

Assuming the 90 days horizon Mfs Emerging Markets is expected to under-perform the Ms Global. In addition to that, Mfs Emerging is 2.8 times more volatile than Ms Global Fixed. It trades about -0.21 of its total potential returns per unit of risk. Ms Global Fixed is currently generating about 0.0 per unit of volatility. If you would invest  526.00  in Ms Global Fixed on September 17, 2024 and sell it today you would earn a total of  0.00  from holding Ms Global Fixed or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Mfs Emerging Markets  vs.  Ms Global Fixed

 Performance 
JavaScript chart by amCharts 3.21.15OctNovDec -4-3-2-1012
JavaScript chart by amCharts 3.21.15EMLBX MFIRX
       Timeline  
Mfs Emerging Markets 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Mfs Emerging Markets has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong fundamental drivers, Mfs Emerging is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec5.355.45.455.55.555.65.655.7
Ms Global Fixed 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Ms Global Fixed has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Ms Global is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
JavaScript chart by amCharts 3.21.15OctNovDecNovDec5.225.235.245.255.265.275.28

Mfs Emerging and Ms Global Volatility Contrast

   Predicted Return Density   
JavaScript chart by amCharts 3.21.15-0.65-0.43-0.21-0.0694-0.008680.04240.09720.30.520.74 5101520
JavaScript chart by amCharts 3.21.15EMLBX MFIRX
       Returns  

Pair Trading with Mfs Emerging and Ms Global

The main advantage of trading using opposite Mfs Emerging and Ms Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mfs Emerging position performs unexpectedly, Ms Global 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 Ms Global will offset losses from the drop in Ms Global's long position.
The idea behind Mfs Emerging Markets and Ms Global Fixed pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Stocks Directory module to find actively traded stocks across global markets.

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