Correlation Between Mfs Research and Johnson Core

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

By analyzing existing cross correlation between Mfs Research International and Johnson Core Plus, you can compare the effects of market volatilities on Mfs Research and Johnson Core 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 Research with a short position of Johnson Core. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mfs Research and Johnson Core.

Diversification Opportunities for Mfs Research and Johnson Core

0.59

Correlation Coefficient

Mfs Research  Johnson Core

Very weak diversification

The 3 months correlation between Mfs and Johnson is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Mfs Research International and Johnson Core Plus in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Johnson Core Plus and Mfs Research 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 Research International are associated (or correlated) with Johnson Core. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Johnson Core Plus has no effect on the direction of Mfs Research i.e., Mfs Research and Johnson Core go up and down completely randomly.

Pair Corralation between Mfs Research and Johnson Core

Assuming the 90 days horizon Mfs Research International is expected to generate 2.7 times more return on investment than Johnson Core. However, Mfs Research is 2.7 times more volatile than Johnson Core Plus. It trades about 0.04 of its potential returns per unit of risk. Johnson Core Plus is currently generating about 0.01 per unit of risk. If you would invest  2,498  in Mfs Research International on May 1, 2025 and sell it today you would earn a total of  184.00  from holding Mfs Research International or generate 7.37% return on investment over 90 days.

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

Mfs Research International  vs.  Johnson Core Plus

Mfs Research Interna

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Mfs Research International are ranked lower than 12 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Mfs Research may actually be approaching a critical reversion point that can send shares even higher in August 2025.

Johnson Core Plus

Risk-Adjusted Performance

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Johnson Core Plus are ranked lower than 3 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong essential indicators, Johnson Core is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Mfs Research and Johnson Core

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

The idea behind Mfs Research International and Johnson Core Plus 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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.