Correlation Between MFS Active and FT Vest
Can any of the company-specific risk be diversified away by investing in both MFS Active and FT Vest 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 Active and FT Vest into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MFS Active Value and FT Vest Equity, you can compare the effects of market volatilities on MFS Active and FT Vest 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 Active with a short position of FT Vest. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFS Active and FT Vest.
Diversification Opportunities for MFS Active and FT Vest
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between MFS and DHDG is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding MFS Active Value and FT Vest Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FT Vest Equity and MFS Active 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 Active Value are associated (or correlated) with FT Vest. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FT Vest Equity has no effect on the direction of MFS Active i.e., MFS Active and FT Vest go up and down completely randomly.
Pair Corralation between MFS Active and FT Vest
Given the investment horizon of 90 days MFS Active Value is expected to generate 2.64 times more return on investment than FT Vest. However, MFS Active is 2.64 times more volatile than FT Vest Equity. It trades about 0.13 of its potential returns per unit of risk. FT Vest Equity is currently generating about 0.21 per unit of risk. If you would invest 2,466 in MFS Active Value on May 27, 2025 and sell it today you would earn a total of 115.00 from holding MFS Active Value or generate 4.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 98.44% |
| Values | Daily Returns |
MFS Active Value vs. FT Vest Equity
Performance |
| Timeline |
| MFS Active Value |
| FT Vest Equity |
MFS Active and FT Vest Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MFS Active and FT Vest
The main advantage of trading using opposite MFS Active and FT Vest positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MFS Active position performs unexpectedly, FT Vest 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 FT Vest will offset losses from the drop in FT Vest's long position.| MFS Active vs. FT Vest Equity | MFS Active vs. Northern Lights | MFS Active vs. Dimensional International High | MFS Active vs. JPMorgan Fundamental Data |
| FT Vest vs. Northern Lights | FT Vest vs. Dimensional International High | FT Vest vs. JPMorgan Fundamental Data | FT Vest vs. Davis Select International |
Check out your portfolio center.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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