Correlation Between Massmutual Select and Jhancock Diversified
Can any of the company-specific risk be diversified away by investing in both Massmutual Select and Jhancock Diversified 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 Jhancock Diversified into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Massmutual Select Diversified and Jhancock Diversified Macro, you can compare the effects of market volatilities on Massmutual Select and Jhancock Diversified 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 Jhancock Diversified. Check out your portfolio center. Please also check ongoing floating volatility patterns of Massmutual Select and Jhancock Diversified.
Diversification Opportunities for Massmutual Select and Jhancock Diversified
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between Massmutual and Jhancock is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding Massmutual Select Diversified and Jhancock Diversified Macro in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jhancock Diversified 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 Diversified are associated (or correlated) with Jhancock Diversified. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jhancock Diversified has no effect on the direction of Massmutual Select i.e., Massmutual Select and Jhancock Diversified go up and down completely randomly.
Pair Corralation between Massmutual Select and Jhancock Diversified
Assuming the 90 days horizon Massmutual Select Diversified is expected to generate 2.52 times more return on investment than Jhancock Diversified. However, Massmutual Select is 2.52 times more volatile than Jhancock Diversified Macro. It trades about 0.02 of its potential returns per unit of risk. Jhancock Diversified Macro is currently generating about -0.03 per unit of risk. If you would invest 1,070 in Massmutual Select Diversified on September 1, 2024 and sell it today you would earn a total of 50.00 from holding Massmutual Select Diversified or generate 4.67% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Massmutual Select Diversified vs. Jhancock Diversified Macro
Performance |
| Timeline |
| Massmutual Select |
| Jhancock Diversified |
Massmutual Select and Jhancock Diversified Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Massmutual Select and Jhancock Diversified
The main advantage of trading using opposite Massmutual Select and Jhancock Diversified positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Massmutual Select position performs unexpectedly, Jhancock Diversified 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 Jhancock Diversified will offset losses from the drop in Jhancock Diversified's long position.| Massmutual Select vs. Columbia Global Technology | Massmutual Select vs. Icon Information Technology | Massmutual Select vs. Global Technology Portfolio | Massmutual Select vs. Biotechnology Fund Class |
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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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