Correlation Between Needham Aggressive and Massmutual Select
Can any of the company-specific risk be diversified away by investing in both Needham Aggressive 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 Needham Aggressive and Massmutual Select into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Needham Aggressive Growth and Massmutual Select Small, you can compare the effects of market volatilities on Needham Aggressive 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 Needham Aggressive with a short position of Massmutual Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of Needham Aggressive and Massmutual Select.
Diversification Opportunities for Needham Aggressive and Massmutual Select
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Needham and Massmutual is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Needham Aggressive Growth and Massmutual Select Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Massmutual Select Small and Needham Aggressive 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 Needham Aggressive Growth 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 Small has no effect on the direction of Needham Aggressive i.e., Needham Aggressive and Massmutual Select go up and down completely randomly.
Pair Corralation between Needham Aggressive and Massmutual Select
Assuming the 90 days horizon Needham Aggressive is expected to generate 1.2 times less return on investment than Massmutual Select. In addition to that, Needham Aggressive is 1.16 times more volatile than Massmutual Select Small. It trades about 0.17 of its total potential returns per unit of risk. Massmutual Select Small is currently generating about 0.24 per unit of volatility. If you would invest 1,005 in Massmutual Select Small on August 29, 2024 and sell it today you would earn a total of 82.00 from holding Massmutual Select Small or generate 8.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Needham Aggressive Growth vs. Massmutual Select Small
Performance |
| Timeline |
| Needham Aggressive Growth |
| Massmutual Select Small |
Needham Aggressive and Massmutual Select Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Needham Aggressive and Massmutual Select
The main advantage of trading using opposite Needham Aggressive and Massmutual Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Needham Aggressive 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.| Needham Aggressive vs. Putnam Equity Income | Needham Aggressive vs. Putnam Growth Opportunities | Needham Aggressive vs. HUMANA INC | Needham Aggressive vs. Aquagold International |
| Massmutual Select vs. Needham Aggressive Growth | Massmutual Select vs. Vanguard High Yield Tax Exempt | Massmutual Select vs. Pace High Yield | Massmutual Select vs. California High Yield Municipal |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Stocks Directory Find actively traded stocks across global markets | |
| CEOs Directory Screen CEOs from public companies around the world | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges |