Correlation Between Massmutual Select and Mmnjx
Can any of the company-specific risk be diversified away by investing in both Massmutual Select and Mmnjx 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 Mmnjx into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Massmutual Select T and Mmnjx, you can compare the effects of market volatilities on Massmutual Select and Mmnjx 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 Mmnjx. Check out your portfolio center. Please also check ongoing floating volatility patterns of Massmutual Select and Mmnjx.
Diversification Opportunities for Massmutual Select and Mmnjx
-0.54 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Massmutual and Mmnjx is -0.54. Overlapping area represents the amount of risk that can be diversified away by holding Massmutual Select T and Mmnjx in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Mmnjx 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 T are associated (or correlated) with Mmnjx. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Mmnjx has no effect on the direction of Massmutual Select i.e., Massmutual Select and Mmnjx go up and down completely randomly.
Pair Corralation between Massmutual Select and Mmnjx
Assuming the 90 days horizon Massmutual Select is expected to generate 107.95 times less return on investment than Mmnjx. But when comparing it to its historical volatility, Massmutual Select T is 4.74 times less risky than Mmnjx. It trades about 0.01 of its potential returns per unit of risk. Mmnjx is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 1,562 in Mmnjx on September 2, 2024 and sell it today you would earn a total of 224.00 from holding Mmnjx or generate 14.34% 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 T vs. Mmnjx
Performance |
| Timeline |
| Massmutual Select |
| Mmnjx |
Massmutual Select and Mmnjx Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Massmutual Select and Mmnjx
The main advantage of trading using opposite Massmutual Select and Mmnjx positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Massmutual Select position performs unexpectedly, Mmnjx 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 Mmnjx will offset losses from the drop in Mmnjx'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 |
| Mmnjx vs. Massmutual Select Mid | Mmnjx vs. Massmutual Select Mid Cap | Mmnjx vs. Massmutual Select Mid Cap | Mmnjx vs. Massmutual Select Mid Cap |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Stocks Directory Find actively traded stocks across global markets | |
| Equity Search Search for actively traded equities including funds and ETFs from over 30 global markets | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |