Correlation Between Massmutual Premier and Mainstay Moderate
Can any of the company-specific risk be diversified away by investing in both Massmutual Premier and Mainstay Moderate 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 Premier and Mainstay Moderate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Massmutual Premier Diversified and Mainstay Moderate Allocation, you can compare the effects of market volatilities on Massmutual Premier and Mainstay Moderate 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 Premier with a short position of Mainstay Moderate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Massmutual Premier and Mainstay Moderate.
Diversification Opportunities for Massmutual Premier and Mainstay Moderate
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Massmutual and Mainstay is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Massmutual Premier Diversified and Mainstay Moderate Allocation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mainstay Moderate and Massmutual Premier 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 Premier Diversified are associated (or correlated) with Mainstay Moderate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mainstay Moderate has no effect on the direction of Massmutual Premier i.e., Massmutual Premier and Mainstay Moderate go up and down completely randomly.
Pair Corralation between Massmutual Premier and Mainstay Moderate
Assuming the 90 days horizon Massmutual Premier is expected to generate 1.04 times less return on investment than Mainstay Moderate. But when comparing it to its historical volatility, Massmutual Premier Diversified is 1.65 times less risky than Mainstay Moderate. It trades about 0.24 of its potential returns per unit of risk. Mainstay Moderate Allocation is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 1,487 in Mainstay Moderate Allocation on September 13, 2024 and sell it today you would earn a total of 17.00 from holding Mainstay Moderate Allocation or generate 1.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Massmutual Premier Diversified vs. Mainstay Moderate Allocation
Performance |
| Timeline |
| Massmutual Premier |
| Mainstay Moderate |
Massmutual Premier and Mainstay Moderate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Massmutual Premier and Mainstay Moderate
The main advantage of trading using opposite Massmutual Premier and Mainstay Moderate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Massmutual Premier position performs unexpectedly, Mainstay Moderate 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 Mainstay Moderate will offset losses from the drop in Mainstay Moderate's long position.| Massmutual Premier vs. Rationalpier 88 Convertible | Massmutual Premier vs. Lord Abbett Convertible | Massmutual Premier vs. Putnam Convertible Incm Gwth | Massmutual Premier vs. Allianzgi Convertible Income |
| Mainstay Moderate vs. Tiaa Cref Small Cap Blend | Mainstay Moderate vs. Pgim Jennison Diversified | Mainstay Moderate vs. Massmutual Premier Diversified | Mainstay Moderate vs. Adams Diversified Equity |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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