Correlation Between Federated Hermes and Mfs Emerging
Can any of the company-specific risk be diversified away by investing in both Federated Hermes and Mfs 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 Federated Hermes and Mfs Emerging into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Federated Hermes Inflation and Mfs Emerging Markets, you can compare the effects of market volatilities on Federated Hermes and Mfs 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 Federated Hermes with a short position of Mfs Emerging. Check out your portfolio center. Please also check ongoing floating volatility patterns of Federated Hermes and Mfs Emerging.
Diversification Opportunities for Federated Hermes and Mfs Emerging
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Federated and Mfs is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Federated Hermes Inflation and Mfs Emerging Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs Emerging Markets and Federated Hermes 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 Federated Hermes Inflation are associated (or correlated) with Mfs Emerging. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs Emerging Markets has no effect on the direction of Federated Hermes i.e., Federated Hermes and Mfs Emerging go up and down completely randomly.
Pair Corralation between Federated Hermes and Mfs Emerging
Assuming the 90 days horizon Federated Hermes Inflation is expected to generate 0.71 times more return on investment than Mfs Emerging. However, Federated Hermes Inflation is 1.41 times less risky than Mfs Emerging. It trades about -0.29 of its potential returns per unit of risk. Mfs Emerging Markets is currently generating about -0.28 per unit of risk. If you would invest 988.00 in Federated Hermes Inflation on September 25, 2024 and sell it today you would lose (14.00) from holding Federated Hermes Inflation or give up 1.42% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 95.24% |
Values | Daily Returns |
Federated Hermes Inflation vs. Mfs Emerging Markets
Performance |
Timeline |
Federated Hermes Inf |
Mfs Emerging Markets |
Federated Hermes and Mfs Emerging Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Federated Hermes and Mfs Emerging
The main advantage of trading using opposite Federated Hermes and Mfs Emerging positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Federated Hermes position performs unexpectedly, Mfs 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 Mfs Emerging will offset losses from the drop in Mfs Emerging's long position.Federated Hermes vs. Federated Emerging Market | Federated Hermes vs. Federated Mdt All | Federated Hermes vs. Federated Mdt Balanced | Federated Hermes vs. Federated Global Allocation |
Mfs Emerging vs. Schwab Treasury Inflation | Mfs Emerging vs. Federated Hermes Inflation | Mfs Emerging vs. Guidepath Managed Futures | Mfs Emerging vs. Ab Bond Inflation |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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