Correlation Between Mfs Intermediate and Largecap

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

By analyzing existing cross correlation between Mfs Intermediate High and Largecap Sp 500, you can compare the effects of market volatilities on Mfs Intermediate and Largecap 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 Intermediate with a short position of Largecap. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mfs Intermediate and Largecap.

Diversification Opportunities for Mfs Intermediate and Largecap

0.92

Correlation Coefficient

Mfs Intermediate  Largecap

Almost no diversification

The 3 months correlation between Mfs and Largecap is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Mfs Intermediate High and Largecap Sp 500 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Largecap Sp 500 and Mfs Intermediate 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 Intermediate High are associated (or correlated) with Largecap. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Largecap Sp 500 has no effect on the direction of Mfs Intermediate i.e., Mfs Intermediate and Largecap go up and down completely randomly.

Pair Corralation between Mfs Intermediate and Largecap

Considering the 90-day investment horizon Mfs Intermediate is expected to generate 2.34 times less return on investment than Largecap. But when comparing it to its historical volatility, Mfs Intermediate High is 1.12 times less risky than Largecap. It trades about 0.1 of its potential returns per unit of risk. Largecap Sp 500 is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest  2,882  in Largecap Sp 500 on May 18, 2025 and sell it today you would earn a total of  249.00  from holding Largecap Sp 500 or generate 8.64% return on investment over 90 days.

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

Mfs Intermediate High  vs.  Largecap Sp 500

Mfs Intermediate High

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in Mfs Intermediate High are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. Despite nearly stable forward indicators, Mfs Intermediate is not utilizing all of its potentials. The current stock price disturbance, may contribute to mid-run losses for the stockholders.

Largecap Sp 500

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Largecap Sp 500 are ranked lower than 16 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Largecap may actually be approaching a critical reversion point that can send shares even higher in September 2025.

Pair Trading with Mfs Intermediate and Largecap

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

The idea behind Mfs Intermediate High and Largecap Sp 500 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.

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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.