Correlation Between Massmutual Premier and Franklin Mutual
Can any of the company-specific risk be diversified away by investing in both Massmutual Premier and Franklin Mutual 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 Franklin Mutual 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 Franklin Mutual Global, you can compare the effects of market volatilities on Massmutual Premier and Franklin Mutual 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 Franklin Mutual. Check out your portfolio center. Please also check ongoing floating volatility patterns of Massmutual Premier and Franklin Mutual.
Diversification Opportunities for Massmutual Premier and Franklin Mutual
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Massmutual and Franklin is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Massmutual Premier Diversified and Franklin Mutual Global in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Franklin Mutual Global 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 Franklin Mutual. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Franklin Mutual Global has no effect on the direction of Massmutual Premier i.e., Massmutual Premier and Franklin Mutual go up and down completely randomly.
Pair Corralation between Massmutual Premier and Franklin Mutual
Assuming the 90 days horizon Massmutual Premier is expected to generate 2.81 times less return on investment than Franklin Mutual. But when comparing it to its historical volatility, Massmutual Premier Diversified is 2.03 times less risky than Franklin Mutual. It trades about 0.04 of its potential returns per unit of risk. Franklin Mutual Global is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 3,090 in Franklin Mutual Global on August 26, 2024 and sell it today you would earn a total of 21.00 from holding Franklin Mutual Global or generate 0.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Massmutual Premier Diversified vs. Franklin Mutual Global
Performance |
| Timeline |
| Massmutual Premier |
| Franklin Mutual Global |
Massmutual Premier and Franklin Mutual Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Massmutual Premier and Franklin Mutual
The main advantage of trading using opposite Massmutual Premier and Franklin Mutual positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Massmutual Premier position performs unexpectedly, Franklin Mutual 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 Franklin Mutual will offset losses from the drop in Franklin Mutual's long position.| Massmutual Premier vs. Massmutual Select Mid | Massmutual Premier vs. Massmutual Select Mid Cap | Massmutual Premier vs. Massmutual Select Mid Cap | Massmutual Premier vs. Massmutual Select Mid Cap |
| Franklin Mutual vs. Tiaa Cref Lifestyle Conservative | Franklin Mutual vs. Massmutual Premier Diversified | Franklin Mutual vs. Lord Abbett Diversified | Franklin Mutual vs. Conservative Balanced Allocation |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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