Correlation Between Massmutual Select and Stralem Equity
Can any of the company-specific risk be diversified away by investing in both Massmutual Select and Stralem Equity 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 Stralem Equity 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 Stralem Equity Fund, you can compare the effects of market volatilities on Massmutual Select and Stralem Equity 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 Stralem Equity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Massmutual Select and Stralem Equity.
Diversification Opportunities for Massmutual Select and Stralem Equity
-0.47 | Correlation Coefficient |
Very good diversification
The 3 months correlation between MASSMUTUAL and Stralem is -0.47. Overlapping area represents the amount of risk that can be diversified away by holding Massmutual Select Diversified and Stralem Equity Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stralem Equity 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 Stralem Equity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stralem Equity has no effect on the direction of Massmutual Select i.e., Massmutual Select and Stralem Equity go up and down completely randomly.
Pair Corralation between Massmutual Select and Stralem Equity
Assuming the 90 days horizon Massmutual Select is expected to generate 5.57 times less return on investment than Stralem Equity. In addition to that, Massmutual Select is 1.55 times more volatile than Stralem Equity Fund. It trades about 0.01 of its total potential returns per unit of risk. Stralem Equity Fund is currently generating about 0.09 per unit of volatility. If you would invest 2,265 in Stralem Equity Fund on September 4, 2024 and sell it today you would earn a total of 952.00 from holding Stralem Equity Fund or generate 42.03% 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. Stralem Equity Fund
Performance |
| Timeline |
| Massmutual Select |
| Stralem Equity |
Massmutual Select and Stralem Equity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Massmutual Select and Stralem Equity
The main advantage of trading using opposite Massmutual Select and Stralem Equity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Massmutual Select position performs unexpectedly, Stralem Equity 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 Stralem Equity will offset losses from the drop in Stralem Equity'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 |
| Stralem Equity vs. Vela Large Cap | Stralem Equity vs. Transamerica Large Cap | Stralem Equity vs. Pace Large Value | Stralem Equity vs. Jhancock Disciplined Value |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios |