Correlation Between Calvert Developed and Hartford Small
Can any of the company-specific risk be diversified away by investing in both Calvert Developed and Hartford Small 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 Calvert Developed and Hartford Small into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Calvert Developed Market and The Hartford Small, you can compare the effects of market volatilities on Calvert Developed and Hartford Small 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 Calvert Developed with a short position of Hartford Small. Check out your portfolio center. Please also check ongoing floating volatility patterns of Calvert Developed and Hartford Small.
Diversification Opportunities for Calvert Developed and Hartford Small
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Calvert and Hartford is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Calvert Developed Market and The Hartford Small in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hartford Small and Calvert Developed 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 Calvert Developed Market are associated (or correlated) with Hartford Small. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hartford Small has no effect on the direction of Calvert Developed i.e., Calvert Developed and Hartford Small go up and down completely randomly.
Pair Corralation between Calvert Developed and Hartford Small
Assuming the 90 days horizon Calvert Developed Market is expected to under-perform the Hartford Small. But the mutual fund apears to be less risky and, when comparing its historical volatility, Calvert Developed Market is 1.37 times less risky than Hartford Small. The mutual fund trades about -0.02 of its potential returns per unit of risk. The The Hartford Small is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,882 in The Hartford Small on September 26, 2024 and sell it today you would earn a total of 148.00 from holding The Hartford Small or generate 7.86% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Calvert Developed Market vs. The Hartford Small
Performance |
Timeline |
Calvert Developed Market |
Hartford Small |
Calvert Developed and Hartford Small Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Calvert Developed and Hartford Small
The main advantage of trading using opposite Calvert Developed and Hartford Small positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Calvert Developed position performs unexpectedly, Hartford Small 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 Hartford Small will offset losses from the drop in Hartford Small's long position.Calvert Developed vs. Calvert Large Cap | Calvert Developed vs. Calvert Large Cap | Calvert Developed vs. Calvert Mid Cap | Calvert Developed vs. Calvert Short Duration |
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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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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