Correlation Between Franklin Emerging and Massmutual Select
Can any of the company-specific risk be diversified away by investing in both Franklin Emerging 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 Franklin Emerging and Massmutual Select into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Franklin Emerging Market and Massmutual Select T, you can compare the effects of market volatilities on Franklin Emerging 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 Franklin Emerging with a short position of Massmutual Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of Franklin Emerging and Massmutual Select.
Diversification Opportunities for Franklin Emerging and Massmutual Select
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between FRANKLIN and Massmutual is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Franklin Emerging Market and Massmutual Select T in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Massmutual Select and Franklin Emerging 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 Franklin Emerging Market 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 Franklin Emerging i.e., Franklin Emerging and Massmutual Select go up and down completely randomly.
Pair Corralation between Franklin Emerging and Massmutual Select
Assuming the 90 days horizon Franklin Emerging Market is expected to generate 0.34 times more return on investment than Massmutual Select. However, Franklin Emerging Market is 2.95 times less risky than Massmutual Select. It trades about 0.17 of its potential returns per unit of risk. Massmutual Select T is currently generating about 0.04 per unit of risk. If you would invest 917.00 in Franklin Emerging Market on November 1, 2024 and sell it today you would earn a total of 256.00 from holding Franklin Emerging Market or generate 27.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Franklin Emerging Market vs. Massmutual Select T
Performance |
| Timeline |
| Franklin Emerging Market |
| Massmutual Select |
Franklin Emerging and Massmutual Select Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Franklin Emerging and Massmutual Select
The main advantage of trading using opposite Franklin Emerging and Massmutual Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Franklin Emerging 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.The idea behind Franklin Emerging Market and Massmutual Select T 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.
| Massmutual Select vs. Victory High Yield | Massmutual Select vs. Artisan High Income | Massmutual Select vs. Payden High Income | Massmutual Select vs. Siit High Yield |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal |