Correlation Between Red Oak and Massmutual Premier

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

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

Diversification Opportunities for Red Oak and Massmutual Premier

0.0

Correlation Coefficient

Red Oak  Massmutual Premier

Pay attention - limited upside

The 3 months correlation between Red and Massmutual is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Red Oak Technology and Massmutual Premier Main in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Massmutual Premier Main and Red Oak 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 Red Oak Technology 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 Main has no effect on the direction of Red Oak i.e., Red Oak and Massmutual Premier go up and down completely randomly.

Pair Corralation between Red Oak and Massmutual Premier

If you would invest (100.00) in Massmutual Premier Main on December 5, 2024 and sell it today you would earn a total of  100.00  from holding Massmutual Premier Main or generate -100.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.0%
Values	Daily Returns

Red Oak Technology  vs.  Massmutual Premier Main

Red Oak Technology

Risk-Adjusted Performance

Very Weak

Over the last 90 days Red Oak Technology has generated negative risk-adjusted returns adding no value to fund investors. In spite of latest weak performance, the Fund's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the fund investors.

Massmutual Premier Main

Risk-Adjusted Performance

Very Weak

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

Pair Trading with Red Oak and Massmutual Premier

The main advantage of trading using opposite Red Oak and Massmutual Premier positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Red Oak 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.

The idea behind Red Oak Technology and Massmutual Premier Main 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.