Correlation Between Kayne Anderson and MFS High

Can any of the company-specific risk be diversified away by investing in both Kayne Anderson and MFS High 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 Kayne Anderson and MFS High into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Kayne Anderson Midstreamenergy and MFS High Income, you can compare the effects of market volatilities on Kayne Anderson and MFS High 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 Kayne Anderson with a short position of MFS High. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kayne Anderson and MFS High.

Diversification Opportunities for Kayne Anderson and MFS High

-0.13

Correlation Coefficient

Kayne Anderson  MFS High

Good diversification

The 3 months correlation between Kayne and MFS is -0.13. Overlapping area represents the amount of risk that can be diversified away by holding Kayne Anderson Midstreamenergy and MFS High Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MFS High Income and Kayne Anderson 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 Kayne Anderson Midstreamenergy are associated (or correlated) with MFS High. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MFS High Income has no effect on the direction of Kayne Anderson i.e., Kayne Anderson and MFS High go up and down completely randomly.

Pair Corralation between Kayne Anderson and MFS High

If you would invest  381.00  in MFS High Income on September 13, 2024 and sell it today you would earn a total of  7.00  from holding MFS High Income or generate 1.84% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	4.76%
Values	Daily Returns

Kayne Anderson Midstreamenergy  vs.  MFS High Income

Kayne Anderson Midst

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Kayne Anderson Midstreamenergy has generated negative risk-adjusted returns adding no value to fund investors. Despite nearly stable primary indicators, Kayne Anderson is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.

MFS High Income

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MFS High Income has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of rather sound basic indicators, MFS High is not utilizing all of its potentials. The recent stock price tumult, may contribute to shorter-term losses for the shareholders.

Pair Trading with Kayne Anderson and MFS High

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

The idea behind Kayne Anderson Midstreamenergy and MFS High Income 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.