Correlation Between Massmutual Premier and Short Precious

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

By analyzing existing cross correlation between Massmutual Premier Short Duration and Short Precious Metals, you can compare the effects of market volatilities on Massmutual Premier and Short Precious 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 Premier with a short position of Short Precious. Check out your portfolio center. Please also check ongoing floating volatility patterns of Massmutual Premier and Short Precious.

Diversification Opportunities for Massmutual Premier and Short Precious

0.14

Correlation Coefficient

Massmutual Premier  Short Precious

Average diversification

The 3 months correlation between Massmutual and Short is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Massmutual Premier Short Durat and Short Precious Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Short Precious Metals and Massmutual Premier 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 Premier Short Duration are associated (or correlated) with Short Precious. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Short Precious Metals has no effect on the direction of Massmutual Premier i.e., Massmutual Premier and Short Precious go up and down completely randomly.

Pair Corralation between Massmutual Premier and Short Precious

Assuming the 90 days horizon Massmutual Premier is expected to generate 7.08 times less return on investment than Short Precious. But when comparing it to its historical volatility, Massmutual Premier Short Duration is 16.19 times less risky than Short Precious. It trades about 0.18 of its potential returns per unit of risk. Short Precious Metals is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest  874.00  in Short Precious Metals on October 26, 2024 and sell it today you would earn a total of  74.00  from holding Short Precious Metals or generate 8.47% return on investment over 90 days.

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

Massmutual Premier Short Durat  vs.  Short Precious Metals

Massmutual Premier

Risk-Adjusted Performance

14 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Massmutual Premier Short Duration are ranked lower than 14 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong fundamental indicators, Massmutual Premier is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Short Precious Metals

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in Short Precious Metals are ranked lower than 6 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly weak forward indicators, Short Precious may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Massmutual Premier and Short Precious

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

The idea behind Massmutual Premier Short Duration and Short Precious Metals 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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.