Correlation Between Aqr Large and Massmutual Select
Can any of the company-specific risk be diversified away by investing in both Aqr Large 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 Aqr Large and Massmutual Select into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aqr Large Cap and Massmutual Select T, you can compare the effects of market volatilities on Aqr Large 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 Aqr Large with a short position of Massmutual Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aqr Large and Massmutual Select.
Diversification Opportunities for Aqr Large and Massmutual Select
0.99 | Correlation Coefficient |
No risk reduction
The 3 months correlation between Aqr and Massmutual is 0.99. Overlapping area represents the amount of risk that can be diversified away by holding Aqr Large Cap and Massmutual Select T in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Massmutual Select and Aqr Large 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 Aqr Large Cap 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 has no effect on the direction of Aqr Large i.e., Aqr Large and Massmutual Select go up and down completely randomly.
Pair Corralation between Aqr Large and Massmutual Select
Assuming the 90 days horizon Aqr Large Cap is expected to generate 1.31 times more return on investment than Massmutual Select. However, Aqr Large is 1.31 times more volatile than Massmutual Select T. It trades about 0.23 of its potential returns per unit of risk. Massmutual Select T is currently generating about 0.21 per unit of risk. If you would invest 2,441 in Aqr Large Cap on August 28, 2024 and sell it today you would earn a total of 128.00 from holding Aqr Large Cap or generate 5.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aqr Large Cap vs. Massmutual Select T
Performance |
| Timeline |
| Aqr Large Cap |
| Massmutual Select |
Aqr Large and Massmutual Select Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aqr Large and Massmutual Select
The main advantage of trading using opposite Aqr Large and Massmutual Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aqr Large 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.| Aqr Large vs. Icon Financial Fund | Aqr Large vs. Mesirow Financial Small | Aqr Large vs. Vanguard Financials Index | Aqr Large vs. Blackrock Financial Institutions |
| Massmutual Select vs. Massmutual Select Mid | Massmutual Select vs. Massmutual Select Mid Cap | Massmutual Select vs. Massmutual Select Mid Cap | Massmutual Select vs. Massmutual Select Mid Cap |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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