Correlation Between GCM Grosvenor and MFS Municipal

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

By analyzing existing cross correlation between GCM Grosvenor and MFS Municipal Income, you can compare the effects of market volatilities on GCM Grosvenor and MFS Municipal 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 GCM Grosvenor with a short position of MFS Municipal. Check out your portfolio center. Please also check ongoing floating volatility patterns of GCM Grosvenor and MFS Municipal.

Diversification Opportunities for GCM Grosvenor and MFS Municipal

-0.17

Correlation Coefficient

GCM Grosvenor  MFS Municipal

Good diversification

The 3 months correlation between GCM and MFS is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding GCM Grosvenor and MFS Municipal Income in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MFS Municipal Income and GCM Grosvenor 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 GCM Grosvenor are associated (or correlated) with MFS Municipal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MFS Municipal Income has no effect on the direction of GCM Grosvenor i.e., GCM Grosvenor and MFS Municipal go up and down completely randomly.

Pair Corralation between GCM Grosvenor and MFS Municipal

Assuming the 90 days horizon GCM Grosvenor is expected to under-perform the MFS Municipal. In addition to that, GCM Grosvenor is 48.02 times more volatile than MFS Municipal Income. It trades about -0.11 of its total potential returns per unit of risk. MFS Municipal Income is currently generating about 0.1 per unit of volatility. If you would invest  509.00  in MFS Municipal Income on August 26, 2025 and sell it today you would earn a total of  21.00  from holding MFS Municipal Income or generate 4.13% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	89.06%
Values	Daily Returns

GCM Grosvenor  vs.  MFS Municipal Income

GCM Grosvenor

Risk-Adjusted Performance

Weakest

Over the last 90 days GCM Grosvenor has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of weak performance in the last few months, the Stock's technical and fundamental indicators remain fairly stable which may send shares a bit higher in December 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

MFS Municipal Income

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in MFS Municipal Income are ranked lower than 7 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy technical and fundamental indicators, MFS Municipal is not utilizing all of its potentials. The current stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with GCM Grosvenor and MFS Municipal

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

The idea behind GCM Grosvenor and MFS Municipal Income 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.

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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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.