Correlation Between Massmutual Select and Goldman Sachs
Can any of the company-specific risk be diversified away by investing in both Massmutual Select and Goldman Sachs 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 Goldman Sachs into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Massmutual Select Mid and Goldman Sachs Large, you can compare the effects of market volatilities on Massmutual Select and Goldman Sachs 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 Goldman Sachs. Check out your portfolio center. Please also check ongoing floating volatility patterns of Massmutual Select and Goldman Sachs.
Diversification Opportunities for Massmutual Select and Goldman Sachs
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Massmutual and GOLDMAN is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Massmutual Select Mid and Goldman Sachs Large in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Goldman Sachs Large 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 Mid are associated (or correlated) with Goldman Sachs. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Goldman Sachs Large has no effect on the direction of Massmutual Select i.e., Massmutual Select and Goldman Sachs go up and down completely randomly.
Pair Corralation between Massmutual Select and Goldman Sachs
Assuming the 90 days horizon Massmutual Select Mid is expected to generate 1.3 times more return on investment than Goldman Sachs. However, Massmutual Select is 1.3 times more volatile than Goldman Sachs Large. It trades about 0.23 of its potential returns per unit of risk. Goldman Sachs Large is currently generating about 0.15 per unit of risk. If you would invest 1,546 in Massmutual Select Mid on August 25, 2024 and sell it today you would earn a total of 80.00 from holding Massmutual Select Mid or generate 5.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Massmutual Select Mid vs. Goldman Sachs Large
Performance |
| Timeline |
| Massmutual Select Mid |
| Goldman Sachs Large |
Massmutual Select and Goldman Sachs Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Massmutual Select and Goldman Sachs
The main advantage of trading using opposite Massmutual Select and Goldman Sachs positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Massmutual Select position performs unexpectedly, Goldman Sachs 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 Goldman Sachs will offset losses from the drop in Goldman Sachs' long position.| Massmutual Select vs. Goldman Sachs Large | Massmutual Select vs. T Rowe Price | Massmutual Select vs. Federated Mdt Large | Massmutual Select vs. Quantitative U S |
| Goldman Sachs vs. Goldman Sachs Clean | Goldman Sachs vs. Goldman Sachs Clean | Goldman Sachs vs. Goldman Sachs Clean | Goldman Sachs vs. Goldman Sachs Clean |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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