Correlation Between Small-cap Value and Mfs Strategic
Can any of the company-specific risk be diversified away by investing in both Small-cap Value and Mfs Strategic 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 Small-cap Value and Mfs Strategic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Small Cap Value Profund and Mfs Strategic Income, you can compare the effects of market volatilities on Small-cap Value and Mfs Strategic 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 Small-cap Value with a short position of Mfs Strategic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Small-cap Value and Mfs Strategic.
Diversification Opportunities for Small-cap Value and Mfs Strategic
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between SMALL-CAP and MFS is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Small Cap Value Profund and Mfs Strategic Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Strategic Income and Small-cap Value 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 Small Cap Value Profund are associated (or correlated) with Mfs Strategic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Strategic Income has no effect on the direction of Small-cap Value i.e., Small-cap Value and Mfs Strategic go up and down completely randomly.
Pair Corralation between Small-cap Value and Mfs Strategic
Assuming the 90 days horizon Small Cap Value Profund is expected to generate 6.16 times more return on investment than Mfs Strategic. However, Small-cap Value is 6.16 times more volatile than Mfs Strategic Income. It trades about 0.04 of its potential returns per unit of risk. Mfs Strategic Income is currently generating about 0.15 per unit of risk. If you would invest 8,561 in Small Cap Value Profund on August 29, 2025 and sell it today you would earn a total of 262.00 from holding Small Cap Value Profund or generate 3.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Small Cap Value Profund vs. Mfs Strategic Income
Performance |
| Timeline |
| Small Cap Value |
| Mfs Strategic Income |
Small-cap Value and Mfs Strategic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Small-cap Value and Mfs Strategic
The main advantage of trading using opposite Small-cap Value and Mfs Strategic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Small-cap Value position performs unexpectedly, Mfs Strategic 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 Strategic will offset losses from the drop in Mfs Strategic's long position.| Small-cap Value vs. Aig Government Money | Small-cap Value vs. Wesmark Government Bond | Small-cap Value vs. Ridgeworth Seix Government | Small-cap Value vs. Short Term Government Fund |
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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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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