Correlation Between Bondbloxx ETF and Mfs International

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

By analyzing existing cross correlation between Bondbloxx ETF Trust and Mfs International Diversification, you can compare the effects of market volatilities on Bondbloxx ETF and Mfs International 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 Bondbloxx ETF with a short position of Mfs International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bondbloxx ETF and Mfs International.

Diversification Opportunities for Bondbloxx ETF and Mfs International

0.88

Correlation Coefficient

Bondbloxx ETF  Mfs International

Very poor diversification

The 3 months correlation between Bondbloxx and Mfs is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Bondbloxx ETF Trust and Mfs International Diversificat in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs International and Bondbloxx ETF 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 Bondbloxx ETF Trust are associated (or correlated) with Mfs International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs International has no effect on the direction of Bondbloxx ETF i.e., Bondbloxx ETF and Mfs International go up and down completely randomly.

Pair Corralation between Bondbloxx ETF and Mfs International

Given the investment horizon of 90 days Bondbloxx ETF is expected to generate 5.48 times less return on investment than Mfs International. But when comparing it to its historical volatility, Bondbloxx ETF Trust is 8.8 times less risky than Mfs International. It trades about 0.26 of its potential returns per unit of risk. Mfs International Diversification is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest  2,287  in Mfs International Diversification on December 28, 2024 and sell it today you would earn a total of  179.00  from holding Mfs International Diversification or generate 7.83% return on investment over 90 days.

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

Bondbloxx ETF Trust  vs.  Mfs International Diversificat

Bondbloxx ETF Trust

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Bondbloxx ETF Trust are ranked lower than 20 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Bondbloxx ETF is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Mfs International

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Mfs International Diversification are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Mfs International may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Bondbloxx ETF and Mfs International

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

The idea behind Bondbloxx ETF Trust and Mfs International Diversification 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.