Correlation Between Barings Active and Massmutual Select
Can any of the company-specific risk be diversified away by investing in both Barings Active 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 Barings Active and Massmutual Select into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Barings Active Short and Massmutual Select Small, you can compare the effects of market volatilities on Barings Active 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 Barings Active with a short position of Massmutual Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of Barings Active and Massmutual Select.
Diversification Opportunities for Barings Active and Massmutual Select
-0.68 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Barings and Massmutual is -0.68. Overlapping area represents the amount of risk that can be diversified away by holding Barings Active Short and Massmutual Select Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Massmutual Select Small and Barings Active 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 Barings Active Short 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 Small has no effect on the direction of Barings Active i.e., Barings Active and Massmutual Select go up and down completely randomly.
Pair Corralation between Barings Active and Massmutual Select
Assuming the 90 days horizon Barings Active Short is expected to generate 0.05 times more return on investment than Massmutual Select. However, Barings Active Short is 20.6 times less risky than Massmutual Select. It trades about -0.13 of its potential returns per unit of risk. Massmutual Select Small is currently generating about -0.1 per unit of risk. If you would invest 931.00 in Barings Active Short on January 20, 2025 and sell it today you would lose (4.00) from holding Barings Active Short or give up 0.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Barings Active Short vs. Massmutual Select Small
Performance |
| Timeline |
| Barings Active Short |
| Massmutual Select Small |
Barings Active and Massmutual Select Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Barings Active and Massmutual Select
The main advantage of trading using opposite Barings Active and Massmutual Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Barings Active 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.| Barings Active vs. Ab Fixed Income Shares | Barings Active vs. T Rowe Price | Barings Active vs. Charles Schwab Family | Barings Active vs. Fifth Third Funds |
| Massmutual Select vs. Fidelity Advisor Diversified | Massmutual Select vs. Janus Global Allocation | Massmutual Select vs. Saat Servative Strategy | Massmutual Select vs. Fulcrum Diversified Absolute |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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