Correlation Between MFS Active and Mairs Power

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

By analyzing existing cross correlation between MFS Active Intermediate and Mairs Power Minnesota, you can compare the effects of market volatilities on MFS Active and Mairs Power 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 Active with a short position of Mairs Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of MFS Active and Mairs Power.

Diversification Opportunities for MFS Active and Mairs Power

0.72

Correlation Coefficient

MFS Active  Mairs Power

Poor diversification

The 3 months correlation between MFS and Mairs is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding MFS Active Intermediate and Mairs Power Minnesota in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mairs Power Minnesota and MFS Active 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 Active Intermediate are associated (or correlated) with Mairs Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mairs Power Minnesota has no effect on the direction of MFS Active i.e., MFS Active and Mairs Power go up and down completely randomly.

Pair Corralation between MFS Active and Mairs Power

Given the investment horizon of 90 days MFS Active Intermediate is expected to generate 0.64 times more return on investment than Mairs Power. However, MFS Active Intermediate is 1.56 times less risky than Mairs Power. It trades about 0.13 of its potential returns per unit of risk. Mairs Power Minnesota is currently generating about 0.06 per unit of risk. If you would invest  2,409  in MFS Active Intermediate on May 10, 2025 and sell it today you would earn a total of  35.50  from holding MFS Active Intermediate or generate 1.47% return on investment over 90 days.

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

MFS Active Intermediate  vs.  Mairs Power Minnesota

MFS Active Intermediate

Risk-Adjusted Performance

Fair

Compared to the overall equity markets, risk-adjusted returns on investments in MFS Active Intermediate are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, MFS Active is not utilizing all of its potentials. The latest stock price disarray, may contribute to short-term losses for the investors.

Mairs Power Minnesota

Risk-Adjusted Performance

Soft

Compared to the overall equity markets, risk-adjusted returns on investments in Mairs Power Minnesota are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of very healthy basic indicators, Mairs Power is not utilizing all of its potentials. The newest stock price disarray, may contribute to short-term losses for the investors.

Pair Trading with MFS Active and Mairs Power

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

The idea behind MFS Active Intermediate and Mairs Power Minnesota 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.