Correlation Between Hartford Growth and NYSE Composite
Can any of the company-specific risk be diversified away by investing in both Hartford Growth and NYSE Composite 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 Hartford Growth and NYSE Composite into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between The Hartford Growth and NYSE Composite, you can compare the effects of market volatilities on Hartford Growth and NYSE Composite 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 Hartford Growth with a short position of NYSE Composite. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hartford Growth and NYSE Composite.
Diversification Opportunities for Hartford Growth and NYSE Composite
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hartford and NYSE is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding The Hartford Growth and NYSE Composite in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NYSE Composite and Hartford Growth 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 The Hartford Growth are associated (or correlated) with NYSE Composite. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NYSE Composite has no effect on the direction of Hartford Growth i.e., Hartford Growth and NYSE Composite go up and down completely randomly.
Pair Corralation between Hartford Growth and NYSE Composite
Assuming the 90 days horizon The Hartford Growth is expected to generate 2.08 times more return on investment than NYSE Composite. However, Hartford Growth is 2.08 times more volatile than NYSE Composite. It trades about -0.02 of its potential returns per unit of risk. NYSE Composite is currently generating about -0.06 per unit of risk. If you would invest 5,466 in The Hartford Growth on February 4, 2024 and sell it today you would lose (39.00) from holding The Hartford Growth or give up 0.71% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
The Hartford Growth vs. NYSE Composite
Performance |
Timeline |
Hartford Growth and NYSE Composite Volatility Contrast
Predicted Return Density |
Returns |
The Hartford Growth
Pair trading matchups for Hartford Growth
NYSE Composite
Pair trading matchups for NYSE Composite
Pair Trading with Hartford Growth and NYSE Composite
The main advantage of trading using opposite Hartford Growth and NYSE Composite positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hartford Growth position performs unexpectedly, NYSE Composite 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 NYSE Composite will offset losses from the drop in NYSE Composite's long position.Hartford Growth vs. Sei Daily Income | Hartford Growth vs. The Saratoga Advantage | Hartford Growth vs. Blrc Sgy Mnp | Hartford Growth vs. Franklin High Yield |
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Check out your portfolio center.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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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