Correlation Between Real Estate and Mfs International

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

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

Diversification Opportunities for Real Estate and Mfs International

0.43

Correlation Coefficient

Real Estate  Mfs International

Very weak diversification

The 3 months correlation between Real and Mfs is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Real Estate Ultrasector and Mfs International Large in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs International Large and Real Estate 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 Real Estate Ultrasector are associated (or correlated) with Mfs International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mfs International Large has no effect on the direction of Real Estate i.e., Real Estate and Mfs International go up and down completely randomly.

Pair Corralation between Real Estate and Mfs International

Assuming the 90 days horizon Real Estate is expected to generate 8.31 times less return on investment than Mfs International. In addition to that, Real Estate is 2.0 times more volatile than Mfs International Large. It trades about 0.01 of its total potential returns per unit of risk. Mfs International Large is currently generating about 0.21 per unit of volatility. If you would invest  1,508  in Mfs International Large on May 13, 2025 and sell it today you would earn a total of  139.00  from holding Mfs International Large or generate 9.22% return on investment over 90 days.

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

Real Estate Ultrasector  vs.  Mfs International Large

Real Estate Ultrasector

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Real Estate Ultrasector are ranked lower than 1 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong forward indicators, Real Estate is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Mfs International Large

Risk-Adjusted Performance

Solid

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

Pair Trading with Real Estate and Mfs International

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

The idea behind Real Estate Ultrasector and Mfs International Large 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.