Correlation Between Mesirow Financial and Massmutual Premier
Can any of the company-specific risk be diversified away by investing in both Mesirow Financial and Massmutual Premier 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 Premier 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 Premier Short Duration, you can compare the effects of market volatilities on Mesirow Financial and Massmutual Premier 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 Premier. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mesirow Financial and Massmutual Premier.
Diversification Opportunities for Mesirow Financial and Massmutual Premier
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Mesirow and Massmutual is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Mesirow Financial Small and Massmutual Premier Short Durat in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Massmutual Premier 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 Premier. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Massmutual Premier has no effect on the direction of Mesirow Financial i.e., Mesirow Financial and Massmutual Premier go up and down completely randomly.
Pair Corralation between Mesirow Financial and Massmutual Premier
Assuming the 90 days horizon Mesirow Financial Small is expected to generate 10.51 times more return on investment than Massmutual Premier. However, Mesirow Financial is 10.51 times more volatile than Massmutual Premier Short Duration. It trades about 0.02 of its potential returns per unit of risk. Massmutual Premier Short Duration is currently generating about 0.12 per unit of risk. If you would invest 1,415 in Mesirow Financial Small on September 14, 2024 and sell it today you would earn a total of 5.00 from holding Mesirow Financial Small or generate 0.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mesirow Financial Small vs. Massmutual Premier Short Durat
Performance |
| Timeline |
| Mesirow Financial Small |
| Massmutual Premier |
Mesirow Financial and Massmutual Premier Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mesirow Financial and Massmutual Premier
The main advantage of trading using opposite Mesirow Financial and Massmutual Premier positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mesirow Financial position performs unexpectedly, Massmutual Premier 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 Premier will offset losses from the drop in Massmutual Premier's long position.| Mesirow Financial vs. Lord Abbett Inflation | Mesirow Financial vs. Arrow Managed Futures | Mesirow Financial vs. Fidelity Sai Inflationfocused | Mesirow Financial vs. Short Duration Inflation |
| Massmutual Premier vs. Angel Oak Ultrashort | Massmutual Premier vs. Virtus Multi Sector Short | Massmutual Premier vs. Lord Abbett Short | Massmutual Premier vs. Franklin Federal Limited Term |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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