Correlation Between Mfs Technology and Ep Emerging
Can any of the company-specific risk be diversified away by investing in both Mfs Technology and Ep Emerging 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 Technology and Ep Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mfs Technology Fund and Ep Emerging Markets, you can compare the effects of market volatilities on Mfs Technology and Ep Emerging 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 Technology with a short position of Ep Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mfs Technology and Ep Emerging.
Diversification Opportunities for Mfs Technology and Ep Emerging
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Mfs and EPASX is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Mfs Technology Fund and Ep Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ep Emerging Markets and Mfs Technology 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 Technology Fund are associated (or correlated) with Ep Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ep Emerging Markets has no effect on the direction of Mfs Technology i.e., Mfs Technology and Ep Emerging go up and down completely randomly.
Pair Corralation between Mfs Technology and Ep Emerging
Assuming the 90 days horizon Mfs Technology Fund is expected to generate 2.01 times more return on investment than Ep Emerging. However, Mfs Technology is 2.01 times more volatile than Ep Emerging Markets. It trades about 0.36 of its potential returns per unit of risk. Ep Emerging Markets is currently generating about 0.32 per unit of risk. If you would invest 3,654 in Mfs Technology Fund on April 23, 2025 and sell it today you would earn a total of 943.00 from holding Mfs Technology Fund or generate 25.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mfs Technology Fund vs. Ep Emerging Markets
Performance |
| Timeline |
| Mfs Technology |
| Ep Emerging Markets |
Mfs Technology and Ep Emerging Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mfs Technology and Ep Emerging
The main advantage of trading using opposite Mfs Technology and Ep Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mfs Technology position performs unexpectedly, Ep Emerging 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 Ep Emerging will offset losses from the drop in Ep Emerging's long position.| Mfs Technology vs. Aqr Large Cap | Mfs Technology vs. Growth Allocation Fund | Mfs Technology vs. Enhanced Large Pany | Mfs Technology vs. Transamerica Asset Allocation |
| Ep Emerging vs. Ab High Income | Ep Emerging vs. Transamerica High Yield | Ep Emerging vs. Pace High Yield | Ep Emerging vs. Siit High Yield |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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