Correlation Between Glg Intl and Massmutual Select
Can any of the company-specific risk be diversified away by investing in both Glg Intl 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 Glg Intl and Massmutual Select into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Glg Intl Small and Massmutual Select Small, you can compare the effects of market volatilities on Glg Intl 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 Glg Intl with a short position of Massmutual Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of Glg Intl and Massmutual Select.
Diversification Opportunities for Glg Intl and Massmutual Select
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Glg and MASSMUTUAL is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Glg Intl Small 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 Glg Intl 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 Glg Intl Small 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 Glg Intl i.e., Glg Intl and Massmutual Select go up and down completely randomly.
Pair Corralation between Glg Intl and Massmutual Select
Assuming the 90 days horizon Glg Intl is expected to generate 14.2 times less return on investment than Massmutual Select. But when comparing it to its historical volatility, Glg Intl Small is 1.5 times less risky than Massmutual Select. It trades about 0.03 of its potential returns per unit of risk. Massmutual Select Small is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 1,005 in Massmutual Select Small on August 28, 2024 and sell it today you would earn a total of 85.00 from holding Massmutual Select Small or generate 8.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Glg Intl Small vs. Massmutual Select Small
Performance |
| Timeline |
| Glg Intl Small |
| Massmutual Select Small |
Glg Intl and Massmutual Select Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Glg Intl and Massmutual Select
The main advantage of trading using opposite Glg Intl and Massmutual Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Glg Intl 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.| Glg Intl vs. Oppenheimer Main Street | Glg Intl vs. Oppenheimer Intl Small | Glg Intl vs. Oppenheimer Main Street | Glg Intl vs. Oppenheimer Global Strtgc |
| Massmutual Select vs. Allianzgi Vertible Fund | Massmutual Select vs. Miller Vertible Bond | Massmutual Select vs. Rationalpier 88 Convertible | Massmutual Select vs. Columbia Vertible Securities |
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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