Correlation Between Massmutual Select and Gamco Global

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Can any of the company-specific risk be diversified away by investing in both Massmutual Select and Gamco Global 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 Gamco Global into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Massmutual Select Small and Gamco Global Gold, you can compare the effects of market volatilities on Massmutual Select and Gamco Global 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 Gamco Global. Check out your portfolio center. Please also check ongoing floating volatility patterns of Massmutual Select and Gamco Global.

Diversification Opportunities for Massmutual Select and Gamco Global

-0.41
  Correlation Coefficient

Very good diversification

The 3 months correlation between Massmutual and Gamco is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Massmutual Select Small and Gamco Global Gold in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gamco Global Gold 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 Small are associated (or correlated) with Gamco Global. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gamco Global Gold has no effect on the direction of Massmutual Select i.e., Massmutual Select and Gamco Global go up and down completely randomly.

Pair Corralation between Massmutual Select and Gamco Global

Assuming the 90 days horizon Massmutual Select Small is expected to generate 1.43 times more return on investment than Gamco Global. However, Massmutual Select is 1.43 times more volatile than Gamco Global Gold. It trades about 0.05 of its potential returns per unit of risk. Gamco Global Gold is currently generating about 0.01 per unit of risk. If you would invest  731.00  in Massmutual Select Small on September 18, 2024 and sell it today you would earn a total of  244.00  from holding Massmutual Select Small or generate 33.38% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthVery Weak
Accuracy100.0%
ValuesDaily Returns

Massmutual Select Small  vs.  Gamco Global Gold

 Performance 
       Timeline  
Massmutual Select Small 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Massmutual Select Small has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong technical and fundamental indicators, Massmutual Select is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.
Gamco Global Gold 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days Gamco Global Gold has generated negative risk-adjusted returns adding no value to fund investors. In spite of fairly strong basic indicators, Gamco Global is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Massmutual Select and Gamco Global Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Massmutual Select and Gamco Global

The main advantage of trading using opposite Massmutual Select and Gamco Global positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Massmutual Select position performs unexpectedly, Gamco Global 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 Gamco Global will offset losses from the drop in Gamco Global's long position.
The idea behind Massmutual Select Small and Gamco Global Gold 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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.

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