Correlation Between Massmutual Select and Fundamental Large
Can any of the company-specific risk be diversified away by investing in both Massmutual Select and Fundamental Large 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 Fundamental Large 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 Fundamental Large Cap, you can compare the effects of market volatilities on Massmutual Select and Fundamental Large 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 Fundamental Large. Check out your portfolio center. Please also check ongoing floating volatility patterns of Massmutual Select and Fundamental Large.
Diversification Opportunities for Massmutual Select and Fundamental Large
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Massmutual and Fundamental is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Massmutual Select T and Fundamental Large Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fundamental Large Cap 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 Fundamental Large. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fundamental Large Cap has no effect on the direction of Massmutual Select i.e., Massmutual Select and Fundamental Large go up and down completely randomly.
Pair Corralation between Massmutual Select and Fundamental Large
Assuming the 90 days horizon Massmutual Select T is expected to generate 0.37 times more return on investment than Fundamental Large. However, Massmutual Select T is 2.7 times less risky than Fundamental Large. It trades about 0.09 of its potential returns per unit of risk. Fundamental Large Cap is currently generating about 0.03 per unit of risk. If you would invest 1,323 in Massmutual Select T on October 24, 2024 and sell it today you would earn a total of 121.00 from holding Massmutual Select T or generate 9.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Massmutual Select T vs. Fundamental Large Cap
Performance |
| Timeline |
| Massmutual Select |
| Fundamental Large Cap |
Massmutual Select and Fundamental Large Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Massmutual Select and Fundamental Large
The main advantage of trading using opposite Massmutual Select and Fundamental Large positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Massmutual Select position performs unexpectedly, Fundamental Large 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 Fundamental Large will offset losses from the drop in Fundamental Large's long position.| Massmutual Select vs. Rbc Global Equity | Massmutual Select vs. Us Global Investors | Massmutual Select vs. Legg Mason Global | Massmutual Select vs. Investec Global Franchise |
| Fundamental Large vs. Cref Inflation Linked Bond | Fundamental Large vs. Arrow Managed Futures | Fundamental Large vs. Great West Inflation Protected Securities | Fundamental Large vs. T Rowe Price |
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 Stocks Directory module to find actively traded stocks across global markets.
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