Correlation Between Ab Small and Massmutual Select
Can any of the company-specific risk be diversified away by investing in both Ab Small 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 Ab Small and Massmutual Select into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ab Small Cap and Massmutual Select Small, you can compare the effects of market volatilities on Ab Small 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 Ab Small with a short position of Massmutual Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ab Small and Massmutual Select.
Diversification Opportunities for Ab Small and Massmutual Select
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between QUAIX and MASSMUTUAL is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Ab Small Cap 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 Ab Small 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 Ab Small Cap 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 Ab Small i.e., Ab Small and Massmutual Select go up and down completely randomly.
Pair Corralation between Ab Small and Massmutual Select
Assuming the 90 days horizon Ab Small Cap is expected to generate 1.11 times more return on investment than Massmutual Select. However, Ab Small is 1.11 times more volatile than Massmutual Select Small. It trades about 0.08 of its potential returns per unit of risk. Massmutual Select Small is currently generating about 0.08 per unit of risk. If you would invest 6,155 in Ab Small Cap on August 25, 2024 and sell it today you would earn a total of 1,531 from holding Ab Small Cap or generate 24.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ab Small Cap vs. Massmutual Select Small
Performance |
| Timeline |
| Ab Small Cap |
| Massmutual Select Small |
Ab Small and Massmutual Select Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ab Small and Massmutual Select
The main advantage of trading using opposite Ab Small and Massmutual Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ab Small 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.| Ab Small vs. The Hartford Equity | Ab Small vs. Dodge International Stock | Ab Small vs. Rbc Global Equity | Ab Small vs. Gmo Global Equity |
| Massmutual Select vs. Massmutual Select Mid | Massmutual Select vs. Massmutual Select Mid Cap | Massmutual Select vs. Massmutual Select Mid Cap | Massmutual Select vs. Massmutual Select Mid Cap |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
Other Complementary Tools
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume |