Correlation Between Massmutual Select and Tiaa Cref

Can any of the company-specific risk be diversified away by investing in both Massmutual Select and Tiaa Cref 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 Massmutual Select and Tiaa Cref into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Massmutual Select Diversified and Tiaa Cref Mid Cap Growth, you can compare the effects of market volatilities on Massmutual Select and Tiaa Cref 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 Massmutual Select with a short position of Tiaa Cref. Check out your portfolio center. Please also check ongoing floating volatility patterns of Massmutual Select and Tiaa Cref.

Diversification Opportunities for Massmutual Select and Tiaa Cref

0.25

Correlation Coefficient

Massmutual Select  Tiaa Cref

Modest diversification

The 3 months correlation between Massmutual and Tiaa is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Massmutual Select Diversified and Tiaa Cref Mid Cap Growth in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tiaa Cref Mid and Massmutual Select 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 Massmutual Select Diversified are associated (or correlated) with Tiaa Cref. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tiaa Cref Mid has no effect on the direction of Massmutual Select i.e., Massmutual Select and Tiaa Cref go up and down completely randomly.

Pair Corralation between Massmutual Select and Tiaa Cref

Assuming the 90 days horizon Massmutual Select Diversified is expected to generate 0.79 times more return on investment than Tiaa Cref. However, Massmutual Select Diversified is 1.27 times less risky than Tiaa Cref. It trades about 0.27 of its potential returns per unit of risk. Tiaa Cref Mid Cap Growth is currently generating about 0.14 per unit of risk. If you would invest  955.00  in Massmutual Select Diversified on October 22, 2024 and sell it today you would earn a total of  34.00  from holding Massmutual Select Diversified or generate 3.56% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Massmutual Select Diversified  vs.  Tiaa Cref Mid Cap Growth

Massmutual Select

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Massmutual Select Diversified has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong forward indicators, Massmutual Select is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Tiaa Cref Mid

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Tiaa Cref Mid Cap Growth are ranked lower than 9 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak basic indicators, Tiaa Cref may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Massmutual Select and Tiaa Cref

The main advantage of trading using opposite Massmutual Select and Tiaa Cref positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Massmutual Select position performs unexpectedly, Tiaa Cref 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 Tiaa Cref will offset losses from the drop in Tiaa Cref's long position.

The idea behind Massmutual Select Diversified and Tiaa Cref Mid Cap Growth pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.