Correlation Between MFS Special and Blackhawk Growth

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

By analyzing existing cross correlation between MFS Special Value and Blackhawk Growth Corp, you can compare the effects of market volatilities on MFS Special and Blackhawk Growth 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 Special with a short position of Blackhawk Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFS Special and Blackhawk Growth.

Diversification Opportunities for MFS Special and Blackhawk Growth

-0.18

Correlation Coefficient

MFS Special  Blackhawk Growth

Good diversification

The 3 months correlation between MFS and Blackhawk is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding MFS Special Value and Blackhawk Growth Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blackhawk Growth Corp and MFS Special 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 Special Value are associated (or correlated) with Blackhawk Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blackhawk Growth Corp has no effect on the direction of MFS Special i.e., MFS Special and Blackhawk Growth go up and down completely randomly.

Pair Corralation between MFS Special and Blackhawk Growth

If you would invest  412.00  in MFS Special Value on August 30, 2024 and sell it today you would earn a total of  0.00  from holding MFS Special Value or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	1.56%
Values	Daily Returns

MFS Special Value  vs.  Blackhawk Growth Corp

MFS Special Value

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days MFS Special Value has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable technical and fundamental indicators, MFS Special is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Blackhawk Growth Corp

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Blackhawk Growth Corp has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fragile performance in the last few months, the Stock's basic indicators remain nearly stable which may send shares a bit higher in December 2024. The current disturbance may also be a sign of long-run up-swing for the company stockholders.

Pair Trading with MFS Special and Blackhawk Growth

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

The idea behind MFS Special Value and Blackhawk Growth Corp 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.