Correlation Between Scout Small and Massmutual Premier
Can any of the company-specific risk be diversified away by investing in both Scout Small 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 Scout Small and Massmutual Premier into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Scout Small Cap and Massmutual Premier E, you can compare the effects of market volatilities on Scout Small 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 Scout Small with a short position of Massmutual Premier. Check out your portfolio center. Please also check ongoing floating volatility patterns of Scout Small and Massmutual Premier.
Diversification Opportunities for Scout Small and Massmutual Premier
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Scout and Massmutual is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Scout Small Cap and Massmutual Premier E in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Massmutual Premier and Scout 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 Scout Small Cap 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 Scout Small i.e., Scout Small and Massmutual Premier go up and down completely randomly.
Pair Corralation between Scout Small and Massmutual Premier
Assuming the 90 days horizon Scout Small Cap is expected to generate 3.18 times more return on investment than Massmutual Premier. However, Scout Small is 3.18 times more volatile than Massmutual Premier E. It trades about 0.06 of its potential returns per unit of risk. Massmutual Premier E is currently generating about 0.06 per unit of risk. If you would invest 2,441 in Scout Small Cap on September 13, 2024 and sell it today you would earn a total of 1,041 from holding Scout Small Cap or generate 42.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Scout Small Cap vs. Massmutual Premier E
Performance |
| Timeline |
| Scout Small Cap |
| Massmutual Premier |
Scout Small and Massmutual Premier Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Scout Small and Massmutual Premier
The main advantage of trading using opposite Scout Small and Massmutual Premier positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Scout Small 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.| Scout Small vs. Carillon Chartwell Short | Scout Small vs. Chartwell Short Duration | Scout Small vs. Carillon Chartwell Short | Scout Small vs. Eagle Growth Income |
| Massmutual Premier vs. Guidemark Smallmid Cap | Massmutual Premier vs. Scout Small Cap | Massmutual Premier vs. Pace Smallmedium Value | Massmutual Premier vs. Kinetics Small 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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