Correlation Between Mesirow Financial and Massmutual Select
Can any of the company-specific risk be diversified away by investing in both Mesirow Financial and Massmutual Select 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 Mesirow Financial and Massmutual Select into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Mesirow Financial Small and Massmutual Select Mid Cap, you can compare the effects of market volatilities on Mesirow Financial and Massmutual Select 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 Mesirow Financial with a short position of Massmutual Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mesirow Financial and Massmutual Select.
Diversification Opportunities for Mesirow Financial and Massmutual Select
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between MESIROW and Massmutual is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Mesirow Financial Small and Massmutual Select Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Massmutual Select Mid and Mesirow Financial 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 Mesirow Financial Small are associated (or correlated) with Massmutual Select. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Massmutual Select Mid has no effect on the direction of Mesirow Financial i.e., Mesirow Financial and Massmutual Select go up and down completely randomly.
Pair Corralation between Mesirow Financial and Massmutual Select
Assuming the 90 days horizon Mesirow Financial Small is expected to generate 1.74 times more return on investment than Massmutual Select. However, Mesirow Financial is 1.74 times more volatile than Massmutual Select Mid Cap. It trades about 0.25 of its potential returns per unit of risk. Massmutual Select Mid Cap is currently generating about 0.41 per unit of risk. If you would invest 1,350 in Mesirow Financial Small on September 1, 2024 and sell it today you would earn a total of 94.00 from holding Mesirow Financial Small or generate 6.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Mesirow Financial Small vs. Massmutual Select Mid Cap
Performance |
| Timeline |
| Mesirow Financial Small |
| Massmutual Select Mid |
Mesirow Financial and Massmutual Select Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mesirow Financial and Massmutual Select
The main advantage of trading using opposite Mesirow Financial and Massmutual Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mesirow Financial position performs unexpectedly, Massmutual Select 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 Massmutual Select will offset losses from the drop in Massmutual Select's long position.| Mesirow Financial vs. Bbh Partner Fund | Mesirow Financial vs. Semiconductor Ultrasector Profund | Mesirow Financial vs. Small Cap Stock | Mesirow Financial vs. Omni Small Cap Value |
| Massmutual Select vs. Huber Capital Diversified | Massmutual Select vs. Calvert Conservative Allocation | Massmutual Select vs. Jhancock Diversified Macro | Massmutual Select vs. Evaluator Conservative Rms |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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