Correlation Between Victory Rs and Massmutual Retiresmart

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

By analyzing existing cross correlation between Victory Rs Partners and Massmutual Retiresmart 2050, you can compare the effects of market volatilities on Victory Rs and Massmutual Retiresmart 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 Victory Rs with a short position of Massmutual Retiresmart. Check out your portfolio center. Please also check ongoing floating volatility patterns of Victory Rs and Massmutual Retiresmart.

Diversification Opportunities for Victory Rs and Massmutual Retiresmart

0.93

Correlation Coefficient

Victory Rs  Massmutual Retiresmart

Almost no diversification

The 3 months correlation between Victory and Massmutual is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Victory Rs Partners and Massmutual Retiresmart 2050 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Massmutual Retiresmart and Victory Rs 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 Victory Rs Partners are associated (or correlated) with Massmutual Retiresmart. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Massmutual Retiresmart has no effect on the direction of Victory Rs i.e., Victory Rs and Massmutual Retiresmart go up and down completely randomly.

Pair Corralation between Victory Rs and Massmutual Retiresmart

Assuming the 90 days horizon Victory Rs Partners is expected to under-perform the Massmutual Retiresmart. But the mutual fund apears to be less risky and, when comparing its historical volatility, Victory Rs Partners is 1.08 times less risky than Massmutual Retiresmart. The mutual fund trades about -0.22 of its potential returns per unit of risk. The Massmutual Retiresmart 2050 is currently generating about -0.1 of returns per unit of risk over similar time horizon. If you would invest  923.00  in Massmutual Retiresmart 2050 on December 5, 2024 and sell it today you would lose (70.00) from holding Massmutual Retiresmart 2050 or give up 7.58% of portfolio value over 90 days.

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

Victory Rs Partners  vs.  Massmutual Retiresmart 2050

Victory Rs Partners

Risk-Adjusted Performance

Very Weak

Over the last 90 days Victory Rs Partners has generated negative risk-adjusted returns adding no value to fund investors. In spite of weak performance in the last few months, the Fund's primary indicators remain fairly strong which may send shares a bit higher in April 2025. The current disturbance may also be a sign of long term up-swing for the fund investors.

Massmutual Retiresmart

Risk-Adjusted Performance

Very Weak

Over the last 90 days Massmutual Retiresmart 2050 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.

Pair Trading with Victory Rs and Massmutual Retiresmart

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

The idea behind Victory Rs Partners and Massmutual Retiresmart 2050 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.