Correlation Between Mfs Technology and Tiaa Cref

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

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

Diversification Opportunities for Mfs Technology and Tiaa Cref

0.94

Correlation Coefficient

Mfs Technology  Tiaa Cref

Almost no diversification

The 3 months correlation between Mfs and Tiaa is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Mfs Technology Fund and Tiaa Cref International Equity in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tiaa Cref International and Mfs Technology 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 Technology Fund are associated (or correlated) with Tiaa Cref. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tiaa Cref International has no effect on the direction of Mfs Technology i.e., Mfs Technology and Tiaa Cref go up and down completely randomly.

Pair Corralation between Mfs Technology and Tiaa Cref

Assuming the 90 days horizon Mfs Technology Fund is expected to generate 1.25 times more return on investment than Tiaa Cref. However, Mfs Technology is 1.25 times more volatile than Tiaa Cref International Equity. It trades about 0.27 of its potential returns per unit of risk. Tiaa Cref International Equity is currently generating about 0.09 per unit of risk. If you would invest  3,977  in Mfs Technology Fund on May 2, 2025 and sell it today you would earn a total of  654.00  from holding Mfs Technology Fund or generate 16.44% return on investment over 90 days.

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

Mfs Technology Fund  vs.  Tiaa Cref International Equity

Mfs Technology

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Mfs Technology Fund are ranked lower than 20 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak fundamental indicators, Mfs Technology showed solid returns over the last few months and may actually be approaching a breakup point.

Tiaa Cref International

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Tiaa Cref International Equity are ranked lower than 7 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong technical and fundamental indicators, Tiaa Cref 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 Technology and Tiaa Cref

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

The idea behind Mfs Technology Fund and Tiaa Cref International Equity 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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.