Correlation Between Tiaa-cref Lifecycle and Mfs International
Can any of the company-specific risk be diversified away by investing in both Tiaa-cref Lifecycle 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 Tiaa-cref Lifecycle and Mfs International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tiaa Cref Lifecycle Retirement and Mfs International Value, you can compare the effects of market volatilities on Tiaa-cref Lifecycle 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 Tiaa-cref Lifecycle with a short position of Mfs International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tiaa-cref Lifecycle and Mfs International.
Diversification Opportunities for Tiaa-cref Lifecycle and Mfs International
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Tiaa-cref and Mfs is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Tiaa Cref Lifecycle Retirement and Mfs International Value in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mfs International Value and Tiaa-cref Lifecycle 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 Tiaa Cref Lifecycle Retirement 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 Value has no effect on the direction of Tiaa-cref Lifecycle i.e., Tiaa-cref Lifecycle and Mfs International go up and down completely randomly.
Pair Corralation between Tiaa-cref Lifecycle and Mfs International
Assuming the 90 days horizon Tiaa-cref Lifecycle is expected to generate 1.08 times less return on investment than Mfs International. But when comparing it to its historical volatility, Tiaa Cref Lifecycle Retirement is 2.42 times less risky than Mfs International. It trades about 0.26 of its potential returns per unit of risk. Mfs International Value is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 4,362 in Mfs International Value on May 5, 2025 and sell it today you would earn a total of 211.00 from holding Mfs International Value or generate 4.84% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Tiaa Cref Lifecycle Retirement vs. Mfs International Value
Performance |
Timeline |
Tiaa Cref Lifecycle |
Mfs International Value |
Risk-Adjusted Performance
OK
Weak | Strong |
Tiaa-cref Lifecycle and Mfs International Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Tiaa-cref Lifecycle and Mfs International
The main advantage of trading using opposite Tiaa-cref Lifecycle and Mfs International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tiaa-cref Lifecycle 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.Tiaa-cref Lifecycle vs. Calvert Global Energy | Tiaa-cref Lifecycle vs. Morgan Stanley Global | Tiaa-cref Lifecycle vs. The Hartford Global | Tiaa-cref Lifecycle vs. Mirova Global Sustainable |
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Check out your portfolio center.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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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