Correlation Between Western Asset and Massmutual Select
Can any of the company-specific risk be diversified away by investing in both Western Asset 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 Western Asset and Massmutual Select into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Western Asset Diversified and Massmutual Select Mid Cap, you can compare the effects of market volatilities on Western Asset 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 Western Asset with a short position of Massmutual Select. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Asset and Massmutual Select.
Diversification Opportunities for Western Asset and Massmutual Select
-0.56 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Western and Massmutual is -0.56. Overlapping area represents the amount of risk that can be diversified away by holding Western Asset Diversified and Massmutual Select Mid Cap in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Massmutual Select Mid and Western Asset 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 Western Asset Diversified 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 Mid has no effect on the direction of Western Asset i.e., Western Asset and Massmutual Select go up and down completely randomly.
Pair Corralation between Western Asset and Massmutual Select
Assuming the 90 days horizon Western Asset is expected to generate 10.4 times less return on investment than Massmutual Select. But when comparing it to its historical volatility, Western Asset Diversified is 2.65 times less risky than Massmutual Select. It trades about 0.11 of its potential returns per unit of risk. Massmutual Select Mid Cap is currently generating about 0.43 of returns per unit of risk over similar time horizon. If you would invest 1,275 in Massmutual Select Mid Cap on September 2, 2024 and sell it today you would earn a total of 89.00 from holding Massmutual Select Mid Cap or generate 6.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Asset Diversified vs. Massmutual Select Mid Cap
Performance |
| Timeline |
| Western Asset Diversified |
| Massmutual Select Mid |
Western Asset and Massmutual Select Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Asset and Massmutual Select
The main advantage of trading using opposite Western Asset and Massmutual Select positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Asset 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.| Western Asset vs. Morningstar Unconstrained Allocation | Western Asset vs. Old Westbury Large | Western Asset vs. T Rowe Price | Western Asset vs. Enhanced Large Pany |
| Massmutual Select vs. Western Asset Diversified | Massmutual Select vs. Evaluator Conservative Rms | Massmutual Select vs. Fidelity Advisor Diversified | Massmutual Select vs. Pioneer Diversified High |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
| USA ETFs Find actively traded Exchange Traded Funds (ETF) in USA | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Efficient Frontier Plot and analyze your portfolio and positions against risk-return landscape of the market. |