Correlation Between Fm Investments and Massmutual Select
Can any of the company-specific risk be diversified away by investing in both Fm Investments 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 Fm Investments and Massmutual Select into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fm Investments Large and Massmutual Select Blue, you can compare the effects of market volatilities on Fm Investments 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 Fm Investments with a short position of Massmutual Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fm Investments and Massmutual Select.
Diversification Opportunities for Fm Investments and Massmutual Select
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between IAFLX and Massmutual is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Fm Investments Large and Massmutual Select Blue in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Massmutual Select Blue and Fm Investments 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 Fm Investments Large 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 Blue has no effect on the direction of Fm Investments i.e., Fm Investments and Massmutual Select go up and down completely randomly.
Pair Corralation between Fm Investments and Massmutual Select
Assuming the 90 days horizon Fm Investments Large is expected to generate 0.9 times more return on investment than Massmutual Select. However, Fm Investments Large is 1.11 times less risky than Massmutual Select. It trades about 0.08 of its potential returns per unit of risk. Massmutual Select Blue is currently generating about 0.06 per unit of risk. If you would invest 1,225 in Fm Investments Large on September 12, 2024 and sell it today you would earn a total of 725.00 from holding Fm Investments Large or generate 59.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.8% |
| Values | Daily Returns |
Fm Investments Large vs. Massmutual Select Blue
Performance |
| Timeline |
| Fm Investments Large |
| Massmutual Select Blue |
Fm Investments and Massmutual Select Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fm Investments and Massmutual Select
The main advantage of trading using opposite Fm Investments and Massmutual Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fm Investments 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.| Fm Investments vs. American Funds The | Fm Investments vs. American Funds The | Fm Investments vs. Growth Fund Of | Fm Investments vs. Growth Fund Of |
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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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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