Correlation Between Jhancock Disciplined and Mfs Commodity

Can any of the company-specific risk be diversified away by investing in both Jhancock Disciplined and Mfs Commodity 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 Jhancock Disciplined and Mfs Commodity into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Jhancock Disciplined Value and Mfs Modity Strategy, you can compare the effects of market volatilities on Jhancock Disciplined and Mfs Commodity 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 Jhancock Disciplined with a short position of Mfs Commodity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jhancock Disciplined and Mfs Commodity.

Diversification Opportunities for Jhancock Disciplined and Mfs Commodity

0.34

Correlation Coefficient

Jhancock Disciplined  Mfs Commodity

Weak diversification

The 3 months correlation between Jhancock and Mfs is 0.34. Overlapping area represents the amount of risk that can be diversified away by holding Jhancock Disciplined Value and Mfs Modity Strategy in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Modity Strategy and Jhancock Disciplined 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 Jhancock Disciplined Value are associated (or correlated) with Mfs Commodity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Modity Strategy has no effect on the direction of Jhancock Disciplined i.e., Jhancock Disciplined and Mfs Commodity go up and down completely randomly.

Pair Corralation between Jhancock Disciplined and Mfs Commodity

Assuming the 90 days horizon Jhancock Disciplined Value is expected to under-perform the Mfs Commodity. In addition to that, Jhancock Disciplined is 1.25 times more volatile than Mfs Modity Strategy. It trades about -0.01 of its total potential returns per unit of risk. Mfs Modity Strategy is currently generating about 0.19 per unit of volatility. If you would invest  355.00  in Mfs Modity Strategy on December 28, 2024 and sell it today you would earn a total of  29.00  from holding Mfs Modity Strategy or generate 8.17% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Jhancock Disciplined Value  vs.  Mfs Modity Strategy

Jhancock Disciplined

Risk-Adjusted Performance

Weak

Over the last 90 days Jhancock Disciplined Value has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Jhancock Disciplined is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Mfs Modity Strategy

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Mfs Modity Strategy are ranked lower than 15 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Mfs Commodity may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Jhancock Disciplined and Mfs Commodity

The main advantage of trading using opposite Jhancock Disciplined and Mfs Commodity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jhancock Disciplined position performs unexpectedly, Mfs Commodity 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 Commodity will offset losses from the drop in Mfs Commodity's long position.

The idea behind Jhancock Disciplined Value and Mfs Modity Strategy 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.