Correlation Between Massmutual Select and Arrow Managed
Can any of the company-specific risk be diversified away by investing in both Massmutual Select and Arrow Managed 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 Arrow Managed 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 Arrow Managed Futures, you can compare the effects of market volatilities on Massmutual Select and Arrow Managed 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 Arrow Managed. Check out your portfolio center. Please also check ongoing floating volatility patterns of Massmutual Select and Arrow Managed.
Diversification Opportunities for Massmutual Select and Arrow Managed
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Massmutual and Arrow is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Massmutual Select T and Arrow Managed Futures in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Arrow Managed Futures 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 Arrow Managed. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Arrow Managed Futures has no effect on the direction of Massmutual Select i.e., Massmutual Select and Arrow Managed go up and down completely randomly.
Pair Corralation between Massmutual Select and Arrow Managed
Assuming the 90 days horizon Massmutual Select T is expected to generate 0.33 times more return on investment than Arrow Managed. However, Massmutual Select T is 3.04 times less risky than Arrow Managed. It trades about 0.08 of its potential returns per unit of risk. Arrow Managed Futures is currently generating about 0.01 per unit of risk. If you would invest 1,221 in Massmutual Select T on September 13, 2024 and sell it today you would earn a total of 278.00 from holding Massmutual Select T or generate 22.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Massmutual Select T vs. Arrow Managed Futures
Performance |
| Timeline |
| Massmutual Select |
| Arrow Managed Futures |
Massmutual Select and Arrow Managed Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Massmutual Select and Arrow Managed
The main advantage of trading using opposite Massmutual Select and Arrow Managed positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Massmutual Select position performs unexpectedly, Arrow Managed 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 Arrow Managed will offset losses from the drop in Arrow Managed's long position.| Massmutual Select vs. Icon Information Technology | Massmutual Select vs. Mfs Technology Fund | Massmutual Select vs. Dreyfus Technology Growth | Massmutual Select vs. Columbia Global Technology |
| Arrow Managed vs. 1919 Financial Services | Arrow Managed vs. Davis Financial Fund | Arrow Managed vs. Vanguard Financials Index | Arrow Managed vs. Prudential Jennison Financial |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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