Correlation Between Massmutual Select and Lifestyle
Can any of the company-specific risk be diversified away by investing in both Massmutual Select and Lifestyle 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 Lifestyle 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 Lifestyle Ii Moderate, you can compare the effects of market volatilities on Massmutual Select and Lifestyle 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 Lifestyle. Check out your portfolio center. Please also check ongoing floating volatility patterns of Massmutual Select and Lifestyle.
Diversification Opportunities for Massmutual Select and Lifestyle
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MASSMUTUAL and Lifestyle is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Massmutual Select Diversified and Lifestyle Ii Moderate in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lifestyle Ii Moderate 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 Lifestyle. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lifestyle Ii Moderate has no effect on the direction of Massmutual Select i.e., Massmutual Select and Lifestyle go up and down completely randomly.
Pair Corralation between Massmutual Select and Lifestyle
Assuming the 90 days horizon Massmutual Select Diversified is expected to generate 3.1 times more return on investment than Lifestyle. However, Massmutual Select is 3.1 times more volatile than Lifestyle Ii Moderate. It trades about 0.3 of its potential returns per unit of risk. Lifestyle Ii Moderate is currently generating about 0.35 per unit of risk. If you would invest 1,048 in Massmutual Select Diversified on September 4, 2024 and sell it today you would earn a total of 68.00 from holding Massmutual Select Diversified or generate 6.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Massmutual Select Diversified vs. Lifestyle Ii Moderate
Performance |
| Timeline |
| Massmutual Select |
| Lifestyle Ii Moderate |
Massmutual Select and Lifestyle Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Massmutual Select and Lifestyle
The main advantage of trading using opposite Massmutual Select and Lifestyle positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Massmutual Select position performs unexpectedly, Lifestyle 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 Lifestyle will offset losses from the drop in Lifestyle'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 |
| Lifestyle vs. Oppenheimer International Diversified | Lifestyle vs. Calvert Conservative Allocation | Lifestyle vs. Massmutual Select Diversified | Lifestyle vs. Pgim Conservative Retirement |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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