Correlation Between Europacific Growth and Massmutual Select
Can any of the company-specific risk be diversified away by investing in both Europacific Growth 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 Europacific Growth and Massmutual Select into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Europacific Growth Fund and Massmutual Select Small, you can compare the effects of market volatilities on Europacific Growth 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 Europacific Growth with a short position of Massmutual Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of Europacific Growth and Massmutual Select.
Diversification Opportunities for Europacific Growth and Massmutual Select
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Europacific and Massmutual is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Europacific Growth Fund 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 Europacific Growth 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 Europacific Growth Fund 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 Europacific Growth i.e., Europacific Growth and Massmutual Select go up and down completely randomly.
Pair Corralation between Europacific Growth and Massmutual Select
Assuming the 90 days horizon Europacific Growth is expected to generate 1.08 times less return on investment than Massmutual Select. But when comparing it to its historical volatility, Europacific Growth Fund is 1.54 times less risky than Massmutual Select. It trades about 0.05 of its potential returns per unit of risk. Massmutual Select Small is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 769.00 in Massmutual Select Small on September 12, 2024 and sell it today you would earn a total of 165.00 from holding Massmutual Select Small or generate 21.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
Europacific Growth Fund vs. Massmutual Select Small
Performance |
| Timeline |
| Europacific Growth |
| Massmutual Select Small |
Europacific Growth and Massmutual Select Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Europacific Growth and Massmutual Select
The main advantage of trading using opposite Europacific Growth and Massmutual Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Europacific Growth 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.| Europacific Growth vs. Lebenthal Lisanti Small | Europacific Growth vs. Champlain Small | Europacific Growth vs. Guidemark Smallmid Cap | Europacific Growth vs. Ab Small Cap |
| Massmutual Select vs. Dreyfusstandish Global Fixed | Massmutual Select vs. Versatile Bond Portfolio | Massmutual Select vs. Touchstone Premium Yield | Massmutual Select vs. Multisector Bond Sma |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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