Correlation Between Massmutual Select and Templeton Developing
Can any of the company-specific risk be diversified away by investing in both Massmutual Select and Templeton Developing 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 Templeton Developing 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 Templeton Developing Markets, you can compare the effects of market volatilities on Massmutual Select and Templeton Developing 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 Templeton Developing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Massmutual Select and Templeton Developing.
Diversification Opportunities for Massmutual Select and Templeton Developing
-0.72 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between MASSMUTUAL and Templeton is -0.72. Overlapping area represents the amount of risk that can be diversified away by holding Massmutual Select Diversified and Templeton Developing Markets in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Templeton Developing 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 Templeton Developing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Templeton Developing has no effect on the direction of Massmutual Select i.e., Massmutual Select and Templeton Developing go up and down completely randomly.
Pair Corralation between Massmutual Select and Templeton Developing
Assuming the 90 days horizon Massmutual Select Diversified is expected to generate 1.09 times more return on investment than Templeton Developing. However, Massmutual Select is 1.09 times more volatile than Templeton Developing Markets. It trades about 0.3 of its potential returns per unit of risk. Templeton Developing Markets is currently generating about -0.12 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 | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Massmutual Select Diversified vs. Templeton Developing Markets
Performance |
| Timeline |
| Massmutual Select |
| Templeton Developing |
Massmutual Select and Templeton Developing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Massmutual Select and Templeton Developing
The main advantage of trading using opposite Massmutual Select and Templeton Developing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Massmutual Select position performs unexpectedly, Templeton Developing 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 Templeton Developing will offset losses from the drop in Templeton Developing'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 |
| Templeton Developing vs. Templeton Foreign Fund | Templeton Developing vs. Franklin Mutual Global | Templeton Developing vs. Templeton Growth Fund | Templeton Developing vs. Franklin Real Estate |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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