Correlation Between Ab Value and Massmutual Select
Can any of the company-specific risk be diversified away by investing in both Ab Value and Massmutual Select 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 Ab Value and Massmutual Select into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Value Fund and Massmutual Select Mid, you can compare the effects of market volatilities on Ab Value and Massmutual Select 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 Ab Value with a short position of Massmutual Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Value and Massmutual Select.
Diversification Opportunities for Ab Value and Massmutual Select
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between ABVCX and Massmutual is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Ab Value Fund and Massmutual Select Mid in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Massmutual Select Mid and Ab Value 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 Ab Value Fund are associated (or correlated) with Massmutual Select. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Massmutual Select Mid has no effect on the direction of Ab Value i.e., Ab Value and Massmutual Select go up and down completely randomly.
Pair Corralation between Ab Value and Massmutual Select
Assuming the 90 days horizon Ab Value Fund is expected to under-perform the Massmutual Select. But the mutual fund apears to be less risky and, when comparing its historical volatility, Ab Value Fund is 1.55 times less risky than Massmutual Select. The mutual fund trades about -0.08 of its potential returns per unit of risk. The Massmutual Select Mid is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,941 in Massmutual Select Mid on September 12, 2024 and sell it today you would earn a total of 28.00 from holding Massmutual Select Mid or generate 1.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Ab Value Fund vs. Massmutual Select Mid
Performance |
| Timeline |
| Ab Value Fund |
| Massmutual Select Mid |
Ab Value and Massmutual Select Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Value and Massmutual Select
The main advantage of trading using opposite Ab Value and Massmutual Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Value position performs unexpectedly, Massmutual Select 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 Massmutual Select will offset losses from the drop in Massmutual Select's long position.| Ab Value vs. Vanguard Value Index | Ab Value vs. Dodge Cox Stock | Ab Value vs. American Mutual Fund | Ab Value vs. American Funds American |
| Massmutual Select vs. Aam Select Income | Massmutual Select vs. Ab Value Fund | Massmutual Select vs. Leggmason Partners Institutional | Massmutual Select vs. Red Oak Technology |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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