Correlation Between Massmutual Select and Growth Fund
Can any of the company-specific risk be diversified away by investing in both Massmutual Select and Growth Fund 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 Massmutual Select and Growth Fund into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Massmutual Select Blue and Growth Fund Of, you can compare the effects of market volatilities on Massmutual Select and Growth Fund 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 Massmutual Select with a short position of Growth Fund. Check out your portfolio center. Please also check ongoing floating volatility patterns of Massmutual Select and Growth Fund.
Diversification Opportunities for Massmutual Select and Growth Fund
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Massmutual and Growth is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Massmutual Select Blue and Growth Fund Of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Growth Fund and Massmutual Select 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 Massmutual Select Blue are associated (or correlated) with Growth Fund. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Growth Fund has no effect on the direction of Massmutual Select i.e., Massmutual Select and Growth Fund go up and down completely randomly.
Pair Corralation between Massmutual Select and Growth Fund
Assuming the 90 days horizon Massmutual Select is expected to generate 3.34 times less return on investment than Growth Fund. In addition to that, Massmutual Select is 1.65 times more volatile than Growth Fund Of. It trades about 0.02 of its total potential returns per unit of risk. Growth Fund Of is currently generating about 0.1 per unit of volatility. If you would invest 6,815 in Growth Fund Of on September 1, 2024 and sell it today you would earn a total of 1,361 from holding Growth Fund Of or generate 19.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.47% |
| Values | Daily Returns |
Massmutual Select Blue vs. Growth Fund Of
Performance |
| Timeline |
| Massmutual Select Blue |
| Growth Fund |
Massmutual Select and Growth Fund Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Massmutual Select and Growth Fund
The main advantage of trading using opposite Massmutual Select and Growth Fund positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Massmutual Select position performs unexpectedly, Growth Fund 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 Growth Fund will offset losses from the drop in Growth Fund's long position.| 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 |
| Growth Fund vs. Europacific Growth Fund | Growth Fund vs. Capital World Growth | Growth Fund vs. American Funds Fundamental | Growth Fund vs. Washington Mutual Investors |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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